In October 2018, consumer magazine Which? published its ‘No Deal’ Brexit report and it’s more than a little concerning for everyone working in the tourism industry.
Which? says that a no-deal result could cause significant disruption, increasing costs and stopping people from travelling within the EU and possibly even beyond the EU.
I am proud to say that I voted against Brexit and that Scotland — where I live and work — voted against leaving the European Union. Coming from a mixed European background (my father was Portuguese and my mother Scottish), it pains me to see Scotland being forced out of the EU, taking many steps back as a society… but that’s another topic for another day.
In the event of a no deal, everything from flights to coach services may no longer be able to operate smoothly or in a cost-efficient way. This will affect tourists, the accommodation industry, and the tours and activities industry. And there’s good reason to assume that Brexit will have reverberations all over the world, not just for the UK and the EU.
Let’s look at how a no-deal Brexit will affect flights, bus services, healthcare cover, and so much more…
If no deal is reached, UK and EU licensed airlines would lose all automatic rights to fly between the two destinations, meaning many flights would be grounded. Each airline would need to seek individual permission to land in an EU country. The Civil Aviation Authority would also no longer be part of the European Aviation Safety Agency (EASA), so they would also have to seek safety authorisation.
What might might surprise you, however, is that even internal flights — such as flights from Heathrow to Edinburgh, for example — would also be grounded if the airline is licensed in the EU. This would have a detrimental effect on all UK and EU tourism businesses.
What makes matters worse is that the government has made it clear that it will not support consumers when disruptions to flights (and the associated holidays) occur:
“Passengers are responsible for ensuring that their insurance and ticket terms and conditions are sufficient to cover possible disruption; and should not expect government assistance in this situation.”
Some travel operators and airlines are even including clauses relating to the closure of airspace in their terms and conditions so that they are not liable.
In the event of a No Deal, the EU has stated that it may decide to not recognise the UK aviation security system in the future. What this means is that if UK travelers have connecting flights within the EU, they will have to collect their luggage for re-screening, going through security once more. This will only cause delays and add to passengers’ travelling times significantly.
The UK Government has told UK bus and coach operators that travelling to the EU may not be possible in the event of a no deal. If nothing is put in place, passengers would have to change coach providers when entering the EU. This will surely drive up prices and cause a great deal of inconvenience.
In the event of a no-deal Brexit, simply driving to and within the EU will also be affected. Each driver will likely require an International Driving Permit (IDP) and this will change depending on the destinations they are travelling to. This again will drive up prices for consumers.
All UK residents will likely require a Green Card to be able to cross borders within the EU.
The EU passed a law that banned retailers charging customers a surcharge but this is likely to change in the event of a no deal. Prior to the passing of this law, the surcharge was 3% which, depending on the trip, can increase prices significantly. Remember that all rises in the customer’s overall cost could discourage and inhibit activity.
The European Health Insurance Card (EHIC) would no longer apply. This means all travellers must have insurance to cover any medical needs. While this will prove more expensive for all tourists, it will prove especially expensive — or perhaps even impossible — for people traveling with pre-existing health conditions.
The EU recently passed a law that stopped mobile operators charging roaming fees. This would probably be reversed for UK residents if an agreement can not be reached. While this would simply revert to the previous system, it would be a notable step back for an innovation that many UK tourists found incredibly convenient. You can, of course, pay for roaming charges, but this is yet another additional expense that would be necessary if the UK were part of the EU.
As a no-deal Brexit will be incredibly detrimental to both the UK and EU, I am hopeful that a deal can be reached. However, there is a strong possibility that there will be no deal. As I work in the tourism industry, and for many other tourism companies, it’s my job to get ready for the worst-case scenario and to ensure that TMA’s clients are ready too.
With a no-deal Brexit, I am sure that the uncertainty of the price increases will deter UK tourists from travelling abroad as much as they have done recently. I think this prediction is sound and very conservative. EU destinations are especially like to see a dramatic decrease in visitors and sales from the UK — at least in the short term
One aspect that is also unclear, is how a no deal result will affect currency exchanges. Given that the pound regularly drops in value when something dramatic happens concerning Brexit, we can expect to see a large drop in the pound’s value. This will hit the consumer’s pocket and it’s important to factor it into the ever-growing list of factors that will discourage tourists traveling from the UK.
For UK tourism businesses, however, the reduction in UK tourists travelling abroad may well help increase sales in domestic tourism as more consumers may look to holiday within the UK. This could be good news for UK tour operators.
If your business relies heavily on UK consumers, you need to act now to change your marketing strategies to ensure that they cater for — and tap into — this shortfall. December 26th until the end of January tends to be a prime time for UK consumers to book trips, so UK providers should ramp up their marketing efforts to entice them. As long as it’s done carefully, you can even suggest that a domestic holiday is a safer bet for customers until the fallout from Brexit clears.
Whatever you do, you must act now to be ready for Brexit — whether a deal can be reached or not. Whatever the result, UK and European tourism businesses will be affected, so it’s important to ensure you’re ready for this transition. You can download the full report from Which? Here. And if you’d like to work with me and the rest of the team here at the Tourism Marketing Agency, please don’t hesitate to get in touch.