Moshe Rafiah was one of the lucky few who managed to travel abroad this summer. While swathes of Britons opted for “staycations” during the coronavirus pandemic, the new boss of travel search site Skyscanner was sunning himself in the Sporades islands in Greece.
It was a much-needed holiday. For most people, travel at the moment is “quite pleasant”, says the 57-year-old. “There are fewer people in airports and less queuing,” he said.
But Rafiah admits he couldn’t switch off for long. He has been put in charge of turning around the fortunes of a travel search company in the middle of a pandemic – and so far, it’s been an almost impossible task.
In July, just a month after Rafiah took up his role as chief executive, travel demand slumped almost 80pc year-on-year and up to 69pc of flights were cancelled. Travel will not return to pre-crisis levels before 2024, according to the International Air Transport Association.
CV bos Moshe Rafiah
Edinburgh-based Skyscanner has been hit hard. At its peak in 2019, the website had 100 million visits on average each month. That figure has fallen 60pc year-on-year since June.
Just a month into his new role, Rafiah had to push through a slew of job cuts. In July, Skycanner told staff it would be cutting a fifth of its 1,500-strong workforce and closing offices in Sofia and Budapest.
Prior to that, the company had placed a freeze on recruitment and cut budgets across every department.
Skyscanner key numbers
“We had to react to the unexpected circumstances, and take some very painful steps,” Rafiah says. Skyscanner generates most of its revenue from taking a cut of bookings made on its site. Without those bookings, revenue has collapsed.
It’s no wonder Rafiah needed to get away. He says Covid-19 has brought about “the biggest crisis to hit aviation in the past 100 years” and Skyscanner has “absolutely” seen similar headwinds to its travel partners.
Rafiah has not had long to get his feet under the table.
He moved to the role of CEO having been asked to shift from the vice chairman post when Bryan Dove left for “personal reasons”. It has been a “very fast learning curve”.
For the travel industry, the pain is far from over. Over the summer months, there were signs of improvement, with “green shoots” in May, June and July as countries opened up travel corridors and more people looked for last-minute deals in relatively safe locations. Low-cost airlines, in particular, had performed well, Rafiah says, as demand for domestic travel firmed up.
However, entering into the traditionally leaner winter months, things look set to worsen. With a second Covid wave emerging in many Western countries, restrictions on travel are already tightening. Just last week, the boss of Europe’s largest airline, Ryanair, warned of a near-collapse of the winter ski season.
International case rates per capita
Rafiah has been trying to put on a brave face. He believes travel will come back to 2019 levels within the next two years. And, until then, the company is “ready to ride this period of time”.
Skyscanner may claim to be ready, but the site is one which relies on there being a wealth of choice for users, all hunting for deals. With airlines and hotels on the brink of collapse, experts have cautioned that booking sites could be dealt a bitter blow should options dry up.
Rafiah doesn’t see this materialising. “Capacity probably will take time to return, but I wouldn’t say there’d be less choice.”
Travel Status
Airlines, he says, have also made cuts to prepare for a downturn. And, “we have a huge number of partners”. “Between the travel agents and airlines, even if there is some consolidation, there’ll be choice for our travellers.”
The company is not juggling these changing headwinds alone. While Rafiah stresses Skyscanner operates independently of its Chinese parent company Trip.com Group, being part of the larger organisation is “beneficial”, he says.
Among politicians, such comments may be food for thought. Skyscanner’s takeover was not without controversy. Coming just days after the Brexit referendum, as the pound slumped, Trip.com’s decision to pounce on the Scottish tech start-up in 2016 for £1.4bn had sparked concern.
Coronavirus Quarantine Tracker Extended
At the time, it was the largest tech travel deal in Europe. Fears over foreign tech takeovers have only mounted, and calls for further scrutiny have been on the rise.
Rafiah is clearly uncomfortable with the topic. He, too, sold his business Travelfusion to Trip.com, and still acts as its CEO. “Scrutiny between countries, of course, is something that’s quite normal and you would expect it,” he says.
Right now, the global nature of travel might be one of the things Skyscanner is holding onto.
The Covid pandemic is likely to rage on for some time. In the UK, restrictions on travel could span across the winter.
Skyscanner may just about have ridden out the turbulence of the past few months, Rafiah may have even found time for a holiday – but travel is an industry in turmoil.
Steering Skyscanner through this, Rafiah admits, is a “big job” – a job which could take a “very long time”.
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