COVID-19 Watch: Hotels, airlines look for new revenue streams, hold on to cash to tide over liquidity crunch

The hotel and airline segments of the tourism industry, which are typically high fixed-cost sectors and have forgone revenue for almost a full quarter due to the impact of COVID-19 and the subsequent lockdown, are now accessing future revenues to tide over the short-term working capital deficit. While all airlines, which had to cancel flights on account of the lockdown, issued credit shells to passengers to make future bookings, some hotels are offering discounts for future bookings.

Even as the airlines industry was completely shut for two months, with the exception of sporadic cargo flights, the hotel industry, too, has been operating at 10-15 per cent occupancy, with losses for these segments mounting on account of incurring fixed-costs.