Travel industry leaders are appealing to agents and advisors to encourage an Australian staycation this festive season and tell travellers to head to regional destinations in a bid to help local communities.
A combination of the rising cost of living, the cost of labour, a lack of labour, plus the collapse of Bonza, have added to the already existing challenges that regional centres are facing, they say.
Plus, any regional travel may even help battling airline Rex, which was recently handed an $80 million loan by the Federal Government to keep it in the air above our more distant destinations.
Rex administrators are saying they are still servicing regional and remote communities and there are plenty of opportunities to travel locally this summer to places holidaymakers may have never even heard of.
The $80m financing facility will be used to invest in a business improvement program that will include increasing the number of operational aircraft. It will strengthen the regional network and help reposition the business for sale, the airline says.
“We’d love to see more people flying with us this summer to explore parts of Australia they may have never seen or want to get back to,” Rex CEO Neville Howell told Travel Weekly. “This is an amazing country and it’s our privilege to help more people discover that for themselves.”
As for QantasLink, it continues to service towns it currently flies to but has not added anything extra. But as part its fleet renewal – announced in June – is gradually retiring its Q200 and Q300s, and investing in 14 additional Q400 turboprops.
In the last few months, the Q400s have started operating in ports that have previously been only serviced by the smaller aircraft, offering a faster and more comfortable experience on the larger aircraft for regional customers. Last month, the Q400 returned to Melbourne meaning they can service flights between Melbourne and Mildura/Bendigo/Wagga/Albury/Devonport with the larger aircraft. Sydney to Moree/Broken Hill/Bendigo are also now being serviced by the larger aircraft.
The first additional Q400 arrived in Australia the weekend and will enter into service in next week or two.
Seeing red over regions
Big Red Group CEO, David Anderson, who represents 3,500 small operators each employing five people or fewer, highlights a 20-30 per cent decline in domestic demand as a reason why regional travel should be on any Christmas holiday list.
“The Federal Government’s announcement of an $80 million support package for Rex is a fantastic start but it’s kind of a (BandAid) over, a bigger crack,” Anderson says, offering a personal anecdote where his son had a choice between a $1200 round ticket flight from Sydney to Coffs Harbour or a nine-hour $100 train ticket. His son took the train.
More needs to be done, says Anderson.
“The kind of the support packages that come into place is incredibly valuable and useful and it needs to be combined with a number of other initiatives to try and create affordable travel into the market,” he says.
For AAT Kings, regional tourism is its bread and butter with CEO Ben Hall saying airlines should be encouraged to fly more regularly and says new routes should be opened up to new destinations across Australia.
“I think the history of airlines has shown that someone will try again to come into the space and maybe with the new WSI (Western Sydney) airport, the revising of airport slots access and the need for greater competition they may have a better chance of success,” he says.
“The government knows we need greater regional aviation routes and need to continue to subsidise and promote these services until they are economically viable.”
With the low season upon regional tourism, there also needs to be inventive ways to get both international and local travellers to far-flung destinations. That includes continued support and funding STOs and RTOs to develop and promote regional tourism, Hall says. But some local business will continue to struggle.
“It’s a mixed bag. Some people are doing well and some are really struggling – same issues of staffing, cost control and interest rates affecting their abilities to operate and grow,” Hall says.
“Given the seasonal nature of our industry in some regional locations, there is extra pressure given other impacts to their businesses that they can’t control like weather and trying to resolve the challenges these cause.”
What would Hall say to travel agents to encourage them to suggest clients look in their own backyard first?
“There are many new and evolved experiences to be found now all across Australia and the quality of the product and experiences need to be seen to be believed,” he says.
“Australia experiences offer everything that people look for overseas but are here in their backyard – immersive experiences, nature, culture, wildlife, adventure, etc.
“Every operator needs the support of Australians and the inbound market to ensure we have a successful industry that contributes significantly to the economy, to jobs and to the wellbeing of everyone,” Hall concludes.
A question of survival
Overall, Anderson adds that the operators he looks after are finding it difficult to survive, even if you can get tourists to regional destinations.
“It’s a really tough, really tough market. I think we’re seeing, typically, domestic demand down 20 or 30 per cent across the board,” he says.
While Melbourne, Sydney, the Gold Coast and other major metro destinations will be on a holiday hitlist for some, “you’re definitely not going to a third (regional) airport, given cost of domestic travel is out of reach,” says Anderson. “So, I think if you then start to think about regional travel, to do it is incredibly difficult.
“And those that have money are travelling internationally, and those that don’t go to Bali,” he says. Much as immigration authorities require travellers to work in country areas, perhaps the possibility of adding a regional fee to any new major international airline deal who scores a much-coveted slot to fly into Sydney, or any of the other busy capitals, to subsidise regional travel.
“From my perspective, price regulation, maybe in a certain sense, circumstances such as (price) capping, I’d love to see the (Federal) Government … broaden its position on subsidies, to help competition, promotion with slots, and I think transparency is part of that holistic piece that helps us all understand the cost to operate.
“I don’t think it’s there’s one silver bullet here to resolve. But what I do know is that the small operators that we’re supporting the excursion and tour operators, small family businesses are often the backbone of Australia. Small family businesses are actually, ultimately the guys who are suffering here because of staff demand and frankly, the cost to get them there in the first instance.”
“I think we’re facing into an existential issue.”
Also, given the past poor performance and/or failure of various domestic airlines, Anderson is also behind any support the Government could add to sustain a long-term view for regional aviation.
I think we’re facing into an existential issue.”
“I think any mandate that a) can provide a more competitive market, b) hold brands to account can only build and foster consumer trust and improve customer service,” he says.
Of those regional tourism business operators Anderson looks after, he says they do it because they love it, and they love where they live, and are usually not out to make big money.
“They want to tell stories, and they want to maintain the history and the culture,” he says. “We will be bereft as a country if we allow these amazing storytellers to die on the vine.”
Feature image: Big Red Group CEO David Anderson.
https://travelweekly.com.au/article/pub-grub-city-vibes-with-country-feels-prove-a-point-of-difference-for-regional-tourism/
