The travel and transport industry will never be the same again. This is the sector that will be transformed the most by COVID-19.
But what awaits it on the other side of the crisis can easily be much better than the current position. The entire travel and transport industry has a unique opportunity to address some of its imbalances, and create cleaner, more efficient and much more customer-friendly transport. But that requires leaders in the travel and transport industry to release enough internal energy to take a good look at what is happening around them, both now and in the future.
It may seem counterintuitive to set up strategy teams at this point, but it's the only sensible thing to do if the transportation and travel industry wants to understand the possibilities the changing desires and habits of consumers will bring - and not, as it has in the past, just react defensively to new players like Hotels.com and Airbnb, which were both extremely quick to capture the latest customer trends.
Customers' travel habits, buying patterns and sustainability requirements have changed forever
The customer is back in the driving seat when it comes to travel and transport, and the winners will be the companies that act fastest in responding to this shift.
As we feel the benefits of a cleaner sky, as employees learn to love working from home and businesses shift to brand new business models and become less dependent on bricks and mortar, the future is radically changing for travel and transport companies.
Research shows that it can take an average of 66 days to change people's behaviour and habits, so it is likely that the global shutdown will result in large and long-term changes in consumption patterns among passengers and other consumers.
New research also shows that only 9 per cent of people in the United Kingdom want their society to go “back to normal”, which proves that consumer expectations have already changed on many fronts, including a stronger sense of community, improved relationships with family and friends and cleaner air.
Based on that mindset, it is logical to question whether employees will accept going back to the same transport and travel patterns as before, especially if we expect to see more pandemics in the future.
Many employers are currently considering the balance between their physical and virtual infrastructure. They have invested in supporting homework in the last few months; considerations that will have a major impact on commuting and business travel. Twitter has just announced that in the future their employees can work as much from home as they want, and at exactly the time they want, and both Facebook and Google allow their employees to work from home throughout the year.
Now that society is reopening here in Denmark, many people will be seeing their family and friends after a long period of isolation and closure, but after a while we will probably see a reduction in demand for transport and travel. For many, the fact that they have either lost their jobs or feel they are in a precarious job, will mean they will avoid expensive journeys. Travel prices may also prove to be far more expensive than we're used to – as providers try to make up some of their lost profits. Finally, we can see that airlines are trimming their fleet of aircraft so that they are left with smaller fleets that are better for the environment. Older planes will be sent into a well-deserved retirement.
What we call important and unavoidable journeys today will be seen as unnecessary for a large majority of travellers. There will be an even bigger difference between "need to have" and "nice to have”.
The shift in consumer behaviour could mean a resurgence of the luxurious and exclusive travel market we last saw in the 60s – and before that at the turn of the century, now just with a green agenda as the focal point.
In order to return to mass tourism and regional low-cost travel, passengers will become more discerning, not only in terms of modern comfort and the length of the journey, but also in terms of health. Overcrowded flights, airports and trains, and the lack of social distancing from other travellers, are likely to be things people will avoid in a post COVID-19 world.
We are very quickly approaching a scenario where people will begin to travel only when they want to and where a digitally connected world, separate from other people, is the norm. Transport providers must not ignore this shift, and other potential shifts, in their expectations of the numbers of passengers travelling.
Delivering comfortable, hassle-free, valuable and clean travel may well be essential because in the current environment there is simply no option other than putting customers in the driving seat. Your company needs to deliver what they want and those who understand and implement that, will secure a very significant competitive advantage.
This is true of airports and airlines, and may be what it takes to find the next wave of success in the industry. No matter where their expectations land after Covid-19, passengers have taken back the central role around which the transport ecosystem revolves. From now on, commercial models, future strategies, route and capacity planning, safety and any other aspect of transportation will begin and end with passengers and their expectations and needs.
Give creative thinkers the freedom to focus on the company's future purpose and direction
The long-term vision that the transport sector needs requires a bold outlook, ambitious goals and a willingness to think about what is possible rather than
what is allowed. Too often, day-to-day operations and firefighting are given priority. Strategic leadership meetings should never again be allowed to move into operational firefighting, and those focused on innovation should not be siloed into operational responsibility or measured by standard and backward-looking KPIs when they are asked to be innovative.
Companies need to look through a long-term lens and that is best done by setting innovative and strategic forces free. Give the strategic thinkers the opportunity and leeway to develop their ideas away from the work to protect the company’s day-to-day operations.
Reinvent the transport sector to meet SDG targets
Before COVID-19, flight shaming, electric vehicles and alternative fuel were already the norm. Politicians had focused on sustainability in the transport sector by committing to CO2 reduction and the 17 climate targets.
In the last few weeks and months, the world has witnessed the positive impact of reduced pollution during the lockdown period. CO2 emissions in China fell 25 per cent, as soon as the lockdown began and coal consumption at China's six largest power plants fell by 40% compared to the last quarter of 2019.
In Europe images have shown the impact of reductions in CO2 emissions in the skies above Northern Italy and many major British cities reported a big drop in particle levels as soon as the lockdown began.
At a critical time for our planet, the corona virus has led to less polluted cities and drastically reduced CO2 emissions from one moment to the next.
Here, too, managers need to understand what this means for changing customer behaviour. We may see that a permanent, voluntary reduction in our travel habits becomes the norm because people will be much more careful when deciding which journeys they take and how they travel.
It is clear that the transport sector will be changed forever, but it may well end up in a much better place than where it came from.
Jon Plate is an expert in growth, innovation and sustainability at PA Consulting.