20In late March, the impact of Covid on tourism was immediateand far-reaching. The industry, like so many others, neededto deal with emergency issues, dramatic revenue loss, ongoinguncertainty, and make urgent adjustments to debt and equityarrangements.Greg Foran officially joined Air New Zealand as ChiefExecutive on 3 February, having not worked in the airlinesector before. But the afternoon before, he says they madethe decision to suspend flying into and out of Shanghai dueto the coronavirus outbreak.“The timing of my arrival meant that I didn’t really havea concept of what the airline was like in a normal operatingenvironment,” he says.“Initially this worried me; I was dealing with a huge crisis,and usually you like to have experience to call upon in thosecircumstances. However, the longer it went on, the moreI began to realise that having not experienced the previouspandemics the airline had responded to like 9/11, SARSor bird flu, meant I didn’t automatically revert to what wehad done then. This was helpful as time went on, as of coursewe know that it has not been like any of those events.”Foran comments that the big difference between Covid andother types of crises is the length and depth of it. We don’t reallyknow when it will end, or what it will look like when it does.“Usually in a crisis like a fire or a hurricane there is a startand a finish, and then you may be dealing with differentcircumstances once it ends. But this has been totally different.We really don’t know, even today, when international passengerflying will start up properly again, what that will look like andwhat the demand is going to be like.”Rob Campbell says this highlights that businesses in the sectorneeded to consider – or to fundamentally re-consider – whattheir 12-month forward-looking model looks like to survive, aswell as the longer-term business models they need to prosper.“My first thought is that for any tourism business, Covid isnot over, not even once we get a vaccine. There are going to bechallenges in terms of tourism numbers globally for some years,and who knows for how long.“In this context, nine months after our first lockdown, themajority of tourism businesses have either found a businessmodel that they can work with, almost always a smaller morerestrictive model, or they are really struggling to find a modelthat will work long-term.“SkyCity as an example has models that work for our largelydomestic gaming and hospitality business, at a smaller levelthan pre-Covid. But some components are still in doubt,such as those that depend on overseas tourism. If you do nothave a market you do not have a business.”Putting on his Tourism Holdings hat, Campbell says thatsome parts of the campervan sector do work on domestic-onlymodels.“The USA seems to work on a smaller level than it was.We are also increasingly confident that an Australia-onlydomestic model will work at a smaller level. However, our NewZealand campervan business is having a larger struggle and theteam is working hard on new models. And Waitomo businessesare significantly dependent on international visitors. The impactis widespread and deep.”ACCEPT, SURVIVE, ADAPT, MAKE DECISIONSThere are many stages to go through when you are facedwith a crisis, says Foran, depending on the nature, depth andseverity of it.“New Zealand is a very desirable tourismdestination: we should be building abusiness around that. With the perceptionthat New Zealand is safe, it becomesimperative that we stay safe.”Rob Campbell, SkyCity and Tourism Holdings“Generally, the first thing to do is accept the conditions thatyou’ve got; there’s no point in denying them. If you accept theconditions, you then need to do some things in the short-termto survive, without losing hope that at some point they willget better. The future may not be the same as it was, but it willbe better than the current conditions. It is really this mindsetI use to get through this.“It’s getting that balance right; I have to accept the conditionsto make decisions, but I do know in a point in time it will comeright. I just can’t tell you when.”His view of how Covid will change tourism more generallyis that when we look back in a decade or two and reflect onthings that have happened, we will realise that Covid may havebeen the genesis of change, and that it accelerated things thatmight have taken 50 years, so they took 10 years instead.
21“The first thing to do is accept the conditionsthat you’ve got; there’s no point in denyingthem. If you accept them, you then need to dosome things in the short-term to survive them,without losing hope that they will get better.”Greg Foran, Air New Zealand
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