Today’s edition of Skift’s daily podcast takes a closer look at Europe’s air traffic problems, declining tourism investment and the growth of boutique hotels.
Hello from Skift. Today is Wednesday August 23. Here’s what you need to know about the travel industry today.
Europe is experiencing a severe shortage of air traffic controllers. It’s not just delaying flights, it’s also hurting the resumption of mainland travel, reports Edward Russell, editor of the publication Skift Airline Weekly.
European airspace manager Eurocontrol found flight delays rose 6% from a year ago, blaming the disruptions in part on understaffed air traffic controllers. Russell writes that the staff shortage appears most severe in France and Germany, the two countries at the heart of Europe’s air traffic control system. An industry executive said at least 700 European air traffic controllers, often led by individual countries, are short of target staffing levels.
Separately, Lufthansa Group CEO Carsten Spohr said in July that air traffic control and other industry constraints would limit growth until at least 2024.
Following, global investment in the travel industry has fallen from pre-pandemic levels. How much? About $100 billion, writes global tourism journalist Dawit Habtemariam.
Habtemariam reports that $856 billion was invested in the industry last year. Although this represents an 11% increase from 2021, this figure is significantly lower than the 2019 figure. Habtemariam notes that global investment in travel and tourism is not expected to return to pre-Covid levels until 2025. three countries with the highest levels of investment in travel and tourism last year were the United States, China and Saudi Arabia.
Finally, the pipeline of boutique and lifestyle hotels in the United States is expected to grow significantly in the near futurebut those forecasts may be too optimistic, reports Sean O’Neill, hotel editor.
According to analysis by hotel consultancy The Highland Group, developers and hotel groups expect to open nearly 60,000 lifestyle, soft brand and boutique hotels by the end of 2027. This figure would represent an annual increase of 29%.
However, Kim Bardoul, a partner at The Highland Group, said those projections were probably too optimistic. Still, O’Neill writes that developers are interested in lifestyle hotels and boutique hotels because of their recent positive financial performance, on par with larger traditional hotels. And customer demand is growing.