How is the Volcano Disruption of European Air Traffic Hurting the Hotel Industry? Counting the Cost

  • Trust International
  • 04.23.10
With the welcome announcement of the reopening of most, if not all, of Northern Europe’s airspace and airports, Trust International, one of the world’s largest hotel reservations companies, offered insight into disruption to hotel booking patterns since the start of the crisis last Thursday.

The flight cancellations have inevitably affected hotel reservation patterns, but to a lesser extent than one might expect.

As a centralized reservation system (CRS), Trust International is able to gain insight on the booking situation via all distribution and reservation channels for more than 60 of the world’s national and international hotels chains, comprising 6,100 hotels, and over USD$4.6 billion worth of hotel reservations annually. These include leisure and corporate reservations made via travel agencies through the global distribution systems, online travel agencies, Internet bookings and telephone call centers.

In summary, the situation may be considered relatively stable.  While cancellations increased to a peak on Monday, April 19, to reach more than 50 percent over normal levels, new reservations also curved upward by more than 25 percent, suggesting travelers were postponing rather than cancelling trips altogether.

Hotels also witnessed significantly increased levels of guests extending their stays and walk-in bookings as travelers booked hotels after their flights were cancelled, which helped mitigate the effect of the cancellations. 

Looking at the booking volumes for future reservations Trust is also reporting on a, so far, comforting trend for some major European destination cities. On Monday, cities such as Barcelona, Copenhagen, Lisbon, London and Munich were still showing reservation levels broadly similar to Monday of the previous week, and Frankfurt, Rome and Stockholm even had slightly higher reservation numbers.

“Looking at hotel groups using Trust’s services, I believe it is a sign of our strengthening economy that the total reservation levels on Monday were the same or slightly higher than the previous week despite the travel disruptions resulting from the volcanic activity,” said Richard Wiegmann, managing director of Trust International. “Given the virtual standstill in air traffic, many travelers are using alternate modes of transportation, not just to get home, but also to embark on new trips, to reach destinations within Europe, so hotels are still being booked.  Due to the flight cancellations, we are, as one would expect, seeing a notable decrease of travelers outside Europe coming into Europe and for Europeans traveling to other international destinations. 

“Until this incident the international hotel industry was actually recovering well after a traumatic 2009, and the outlook for the rest of the year was promising," Wiegmann continued.  We believe that if the airspace stays open, growth will resume and, most importantly, that there will be no repetition of the major inconvenience experienced by so many travelers over the last six days.  If that happens, it appears that the cost will not be quite as great as many had feared just two days ago.

Trust International is one of the world’s leading CRS providers and international hospitality partners. Trust’s services and supporting technologies help hotel chains and hospitality groups support their sales and marketing activities with the latest distribution solutions. The range of services includes CRS solutions and software, connectivity to all GDS and IDS channels, an Internet booking engine and third-party integration to PMSs, RMSs and CMSs. Trust International offers the full range of CRS-related products such as content management, business intelligence and commission payment services.

Via Trust’s own communication centers located in North America, Europe and The Far East customers in 47 countries are served with private-label telephone reservation, concierge and telemarketing services. Established in 1989, Trust International is renowned for its highly reliable reservation platform, continuous investment in system software and hardware and delivery of superior customer value.




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