Travel industry shows signs of resilience

Despite devastating losses in the weeks following Sept. 11, several speakers noted how the travel industry has bounced back. The recovery didn't just happen by itself -- industry leaders took action to revive their segments:

Phillip Kleweno: The cruise industry and P&O Princess have shown considerable resilience over the past year. In each of the three quarters since Sept. 11, we've been able to report a year-over-year increase in earnings, and all of our ships are at full capacity.

We found the intersection of greed and fear. There were promotional prices that were unprecedented. Yields were down anywhere between 5% and 8% each quarter, but now prices have returned to pre-9/11 levels.

We have the luxury of having a flexible asset base -- we can redeploy our ships between different markets. Back in October, we decided to take one-third of our capacity out of Europe and bring it to North America. While it's difficult to fill up a sailing that isn't published, we felt that was the right risk-management strategy. This proved enormously valuable -- it allowed people to go on a vacation without having to get on an airplane.

Adam Aron: We had an immediate falloff in demand, just three-and-a-half months before Christmas. But in a short 90 days, we revved up our sales and marketing activities and stayed as diligent as ever in delivering a customer-pleasing product, and our lift ticket revenue this last ski season ended up being the best in our 40-year history. And our revenues were up all ski season long, from Christmas to Easter.

If you look at the U.S. hotel industry, the upscale part of it, right after Sept. 11, revenues were off about a third, year over year, and if you look at the data through July, the upscale U.S. hotel industry is off only about 5%. It's down, but it certainly shows a recovery from 33%.

Sam Katz: I think it's pretty remarkable how resilient people are, consumers are, Americans are -- really, people around the world are. This resilience keeps us all in business. It's a fascinating time to be in this industry because it's like a new frontier, and we think that's going to lead to a lot of activity -- partnerships and consolidations. And the effect technology is having on business models makes for a very fluid dynamic.

Michelle Peluso: I think ours is a good news story. Travelocity just conducted a poll of 1,000 random homes. More than 90% report that they are as likely to fly -- or more likely to fly -- since Sept. 11, which to me is stunning. Online sales are, I think, up 38%, partially because of the price wars, but partially, I think, because of the service.

Katerina Pavlitova: After 9/11, we were all in a very delicate situation because, to start a marketing campaign that's sensitive enough and respectful enough of people's feelings, it's not easy to do. However, there was one country that just grabbed this opportunity and ran with it, and that was Great Britain. And they have their prime minister to thank for that. It was the political response of Great Britain, which was swift and strong, and the British Tourist Authority rode on the tails of this and did an amazing job of bringing a lot of Americans to Britain that fall, when everybody else was suffering. I think we can all learn a lesson from it.

Hal Rosenbluth: Our industry not only survived, but many of us have thrived during the most difficult times. I think we all -- I hate to use the expression -- but we do the ugly well.

For additional coverage, see:

Travel execs see industry at a crossroads
Post-Sept.11, a new norm is taking shape
Airlines still in crisis mode one year later
Yields pay price for heavy discounting
Turbulent times force Europe to shift focus
TW agent poll: Better times are coming


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