Travel Bound's Phillips: Navigating the Post-Brexit World
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How is business evolving for Travel Bound in the post-Brexit period? On a day-to-day basis things seem to be okay from a traveler’s point of view.
Yes. Before anything can happen the leadership needs to be resolved, which looks like it’s starting to happen now. On Sept. 9, there will be an election for Conservative party. Once that is resolved, things will start to move forward meaningfully.
Cameron walked away from it—probably rightly so—and said, “I ain’t leading this thing. Now you will get it but not from me.”
Once the leadership issues are resolved, a clear direction will start to emerge. The true shape of things will come. I don’t necessarily see a massive change.
I’m a Brit looking at the headlines saying, “Oh my God, what is happening?” But, for the average American traveler, they may not be caught up in it. They may see it as slightly exotic thing that’s going on. It may not resonate. With the exchange rates, and as things stabilize, I think actually it’s not going to be a huge drama.
You’re right that there is something exotic and interesting about the situation. England still charming as ever, so why not go now? Is it too soon for any price changes to show up in hotels that you’ve contracted with?
The prices are better. In our contracting process, we have people around the world contracting hotels and others contracting services. Whereever we encounter major shifts in markets we will always update contracts to the contract that will reflect changes in the market. We don’t move prices up, obviously, but we move them down.
If any market requires our help, we’ll renegotiate and send more travelers...that’s the idea basically. In London we’re not there yet. We’re not at a place where hotels officially are looking to renegotiate. It’s more of a situation where the exchange rate looks great. For eating and drinking and having a good time, going to a show, it’s a lot less expensive.
That’s a good news story.
Other parts of Europe suffered from different things happening, whether it’s perception or reality. There are some amazing deals out there in Europe and some great value. We’ve adjusted rates and it’s a very good value year to travel. For example in Paris, which is an incredibly safe city, the prices are still great.
Paris is clearly less expensive because there have been fewer travelers for reasons we know about. Hotels have been very forthcoming in supporting travelers coming in. They want the Americans. They are welcoming and the rates reflect that.
I guess all the prices dropped after the Brexit vote.
Yes, it was a universal drop. I think the pound was the most impacted, but the euro itself is a great value. You take it for granted. The exchange rate moved. It’s a great time to take advantage of that. Let’s go and travel. It’s a good time.
The euro is now $1.11. It’s a better value for us. The dollar equals 90 cents in euros. The pound is down to $1.3 dollars. Bloody hell! It’s such a good time for Americans to travel. The dollar is 75 pence, which is extraordinary.
When it was two dollars to a pound, I used to travel the states on business and it was ridiculous. It was great. Unfortunately that changed. There are big forces at work. The cost benefit shouldn’t be taken for granted because things shift, particularly in a world where it is inherently less predictable at the moment.
And the pound has dropped even more than the euro.
Yes, absolutely. The pound took a pounding. We’re definitely paying the price of our own activity.
In regard to travel you say: An event has occurred and that will influence travel. Whether it’s terror, or the Brexit situation or a strike, the reality is that we know that the there is no normal year now.
Every year things happen. I can’t remember any year when there hasn’t been something going on that affected travel. At some point you say, well, it’s what it is. If you don’t travel this year what is going to happen next year? Things aren’t necessarily going to radically improve next year or be radically better somehow.
I think the question is, when the opportunity is presented, take it.
What a great opportunity to travel in Europe now, and be a rich person!
There has been a couple of big economic events within the last generation that have really been seismic. The question is: is Brexit one of those events? Or are we seeing a market flourish that will eventually die away when things stabilize. Or is there something more significant? I think that is yet to play out.
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