As the world watches the health and economic devastation from the Covid-19 pandemic grow, talking about its impact on the luxury travel industry might, on its face, come across as tone deaf.
But as a new report from the U.K.-based consulting group Barton done for the International Luxury Travel Market shows, the luxury travel industry plays a huge role in economies across the globe and will also likely help lead the recovery.
The report says that the luxury global travel ecosystem is valued at $2.05 trillion, or about double that of the consumer electronics and global fashion retail industries.
The sector, the report says, is also a vital component in the distribution of wealth across the globe, with local economies being dependent on luxury travelers to help support their arts, culture, restaurants, guides, sporting events and other activities.
And about 90% of businesses in the sector are small, independent operations, Barton president Winston Chesterfield said in a podcast.
"This is not a group of global corporations," he said. "These are small local businesses."
Luxury travel's impact is especially important across small or less developed countries that are more reliant on international travel and have no safety nets to offer businesses shuttered by the global travel shutdown, Chesterfield said.
"I think it is very easy, from an outside perspective, to dismiss luxury travel as something which happens to a very small group of people and is all about privacy and privilege and is all about hiding yourself away in suites and beachside villas and huts and enjoying it all on your own," he said.
"That is a very stereotypical view. [Luxury travelers] are engaging. They will go around to a local restaurant. They will put money back into the local economy -- and a significant amount."
In reality, he said, luxury travelers contribute a disproportionate amount to travel around the globe.
And high-net-worth individuals are expected to the be the first to start traveling, Chesterfield said.
"I think it stands to reason that the early adopters, as it were, of the new world we are going to see enter after this is all over and say they need to go out traveling, need to go around the world. are high-net worth individuals," he said.
"And once that early wave of wealthy people are traveling again, as they are fully expected to do because they have the deepest pockets and are less concerned about the long-term economic consequences, they are actually going to be the ones that are the vanguards of the new travel world, and they are also going to be taking their wealth to all these locations around the world that have been starved of this revenue for so long."