Dollar value a domestic myth, says Turner

Dollar value a domestic myth, says Turner
By admin

A recovery in domestic tourism is not wedded to a fall in the value of the Australian dollar against its US counterpart, with travellers likely to head overseas irrespective of the exchange rate, Flight Centre managing director Graham Turner has declared.

Writing in the retailer’s annual report, Turner said there were “several reasons” why the dollar’s value would not be the catalyst for domestic growth.

Chief among them was the irrelevance of the US exchange rate with most tourists as only a few destinations are designated in US dollars.

“Secondly, our experience shows that travellers typically respond to exchange rate shifts by upgrading or downgrading their arrangements rather than shifting away from particular destinations,” Turner said. “When the Australian dollar is strong they may stay longer, eat out more often or upgrade accommodation. Conversely, a weaker dollar may see travellers downsize holidays or opt for an apartment rather than a hotel suite.”

It was also unrealistic to believe that a traveller will automatically switch to a domestic destination even if they are deterred by an exchange rate shift.

“That traveller may, of course, simply choose to holiday at another overseas location that offers great value for money,” Turner said. “Examples include Fiji, Bali and Thailand which are highly affordable and perennial favourites for Australian travellers.”

Flight Centre’s annual report also again flagged its move to create a “blended travel agency” that will combine a traditional bricks and mortar model with online (FC plans “cyber twin” for agents, Travel Today, August 28).

“Blended Travel will combine the on and offline model’s best features and will offer customers instant and deep access to FLT’s products in the ways and at the times that suit them best,” chief operating officer Melanie Waters-Ryan said.

She added that it was also finetuning a model that will allow consultants – which she described as “expert human search engines” – to be allocated to look after online customers “in good times and bad”.

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