AFTA View – May 2011
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The challenges of carbon tax, consumer confidence and AUD levels
By Jay Westbury, chief executive Australian Federation
of Travel Agents
THE Federal Budget appears to me to be under a much greater microscope this year than previous years and perhaps given that there is no clarity about the pending carbon tax, it is with good reason. Whatever your personal view is on a carbon tax, there is no question that it will have a significant impact on the travel industry should it go ahead.
Costs will increase if a carbon tax in any form is to be imposed and this will mean travel either domestically or internationally will be more expensive.
The last thing the industry really needs is another tax. Albeit, if for a good reasons, but I am still not convinced that the proposals that have been talked about will really make any difference to the global climate. Maybe we are in a bubble in Australia and our climate will improve?
The other killer on the horizon for travel is the consumer confidence rating. When I was preparing this AFTA View, consumer confidence had just taken a dive south and all of the indicators were saying it is going to dive further.
Meanwhile, reports of the Aussie dollar holding at the $1.10 or better and for sometime continue to be reported. I have heard reports that it could go as high as $1.70. It seems almost impossible that it could go that high.
Both the level of the dollar and consumer confidence levels represent challenges for the travel industry but for totally different reasons.
Consumer confidence is the one thing that indicates if consumers will spend and spend on travel. It also has a replicating impact on corporate travel as that appears to follow in the footsteps of consumer confidence.
As for the dollar, the challenge is that forward pricing becomes also difficult. If all of the exchange gain is passed on, but there is a hiccup, what the consumer is asked to pay can change presenting the industry with a new challenge.
So the next few months are going to present the industry with new challenges all related to tax, confidence and exchange rates. Very dry.
On a lighter note, I am very pleased with the continued support of the National Travel Industry Awards (NTIA) in 2011. Records have been broken once again for nominations and entries. For all those that are finalists, I wish you good luck and all the best.
This year we have a new category for “Best Conference and Incentive Agency”, for the first time recognising those qualified to enter under this category.
Also, Best Retail Group over 100 stores will be a judged category. This means those finalists will have to prepare a presentation and sit before the judging panel. This clearly raises the bar in terms of who wins in this category and it is a bold move by the AFTA board given the competitive nature of the group brands.
All of this will be presented on the gala night of nights for the travel industry in July with, of course, another very big event planned and of course the return of the AFTA Party to follow the gala dinner presentation.
Thank you to everyone that has gotten behind the NTIA this year, including the sponsors, agents and suppliers. A special thank you to travelBulletin and its editor, Ian McMahon.
Jay Westbury’s AFTA View column appears monthly.