Travel agents in hibernation mode, holding on for rebound

The number of travel agent closures over the last eight months has remained relatively low.
The number of travel agent closures over the last eight months has remained relatively low.PHOTO: ST FILE

The winding up of established travel agency STA Travel is a blow to the industry, but no wave of mass closures is expected to follow for now, observers say.

Despite a near-zero business environment, the number of travel agent closures over the last eight months has remained relatively low at 22, about half that of the same period last year, figures from the Singapore Tourism Board (STB) show.

Industry players say this is likely due to the fact that the majority of operators have pared costs and gone into hibernation mode, kept afloat by government support schemes. Some have also pivoted to sell staycation packages to the domestic market, while agents that cater to inbound tourism are now focusing on Singapore-bound international students.

STA Travel stopped operations last month, after its Swiss-based parent company filed for insolvency in August.

Mr Samson Tan, chief executive of GTMC Travel, said the extension of wage subsidies through March next year has been a lifeline for many, while employees are also taking pay cuts, going on training courses and being redeployed during the lull.

His firm has also moved into a smaller office which it shares with another travel agent to save on rent.

"I think after March if nothing happens and the Government doesn't extend (wage subsidies), a lot may call it a day. But most can hang on till then," he said.

Ms Alicia Seah, director of public relations and communications at Dynasty Travel, said the firm is gearing up for the resumption of corporate travel.

As safety considerations and country-specific requirements are now a major concern for travellers, "the role of travel agents will become even more essential post-Covid", she said.

 
 
 

Mr Steven Ler, president of the National Association of Travel Agents Singapore, said he sees light at the end of the tunnel, given the high demand for structured itineraries and end-to-end travel solutions as business and essential travel picks up.

Singapore's move to allow bigger conferences of up to 250 people will bring more visitors in the coming months, and the industry is working with ground operators to ensure a smooth process, he said.

There is also strong, pent-up demand for leisure travel, he added.

"Customers want to know what they need to be aware of, such as when they need to undergo the swab test, if they need to be quarantined and whether there is a list of approved places to stay. These are some of the pieces we are trying to pull together," he said.

A version of this article appeared in the print edition of The Straits Times on October 01, 2020, with the headline 'Travel agents in hibernation mode, holding on for rebound'. Print Edition | Subscribe