As SriLankan Airlines grapples with a flood of cancellations in the wake of the Easter Sunday bombings, its chief executive is expecting a revenue loss of at least US$100 million due to an estimated drop of 30 per cent in tourist arrivals this year.
“We have been closely monitoring forward bookings for the next three months and as of today, cancellations in May is 17 per cent compared to May last year, 12 per cent in June (against June 2018) and about 18 per cent in July,” SriLankan Airlines CEO Vipula Gunatilleka told TTG Asia on Tuesday. “We expect the figures to go up.”
The airline accounts for one-third of the tourist traffic into the country. The government had set an ambitious target of three million arrivals in 2019, up from 2.3 million in 2018.
However after the Easter Sunday blasts which killed 253 including 40 tourists, the authorities estimate a 30 per cent drop following a wave of cancellations and a flow of travel advisories from countries like India, China, the UK, the US and Canada urging their nationals to postpone non-essential travel.
The airline’s new five-year business plan for 2019-2024, which was announced to the media earlier this month, would be re-visited, Gunatilleka said. A key aspect of that strategic business plan includes “developing a route network to match customer demand and market opportunities, including new destinations in Europe, Africa, the Middle East, South Asia, the Far East and Australia, as opposed to the limited point-to-point strategy”.
Noting that the worst affected routes are London and Tokyo, Gunatilleka said the airline is awaiting update from the authorities as to when the situation would return to normal. Security forces, helped by British and US intelligence, have fanned out across the country hunting for Muslim extremists, responsible for the bombings at churches and luxury hotels. Scores of arrests have been made along with weapons and explosives.
“The moment we have some clarity from the government then we can work (with the authorities) on relaxing the travel advisories. Without this clarity and assurances there is no use in targetted marketing and special promotions,” he said, adding that they would then examine how traffic could be increased from India and China, Sri Lanka’s main tourist source markets.
“We can bounce back once normalcy is restored,” he said, noting that currently travellers are not even keen to be transiting in Colombo.