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The boss of $2.5 billion travel booking business Webjet says Australia should implement stronger consumer protections in the tourism and travel industry, amid calls to bolster customers’ rights.
Webject chief John Guscic said it was clear airline customers had been disproportionately let down by poor consumer protection measures, while unveiling a net profit of $47 million for the first half of the financial year.
Webjet boss John Guscic says Australian travellers deserve better consumer protections.Credit: Webjet
“I think Australian travel consumers and the industry would be better off if there were greater protections around bookings and being able to fulfil them,” Guscic said. He said the issue was not affecting hotel customers in the same way as those booking air travel.
“Philosophically I’m usually against more regulation, but there are exceptions and I think [the tourism sector] is one of them,” he added.
Transport Minister Catherine King has faced calls from the Australian Competition and Consumer Commission (ACCC) and consumer group Choice to reform consumer protections across the aviation and tourism sector since travel resumed after COVID-19.
The government recently flagged it may create an independent ombudsman scheme for the travel industry as per the recommendations of the ACCC and Choice. This would likely replace the Airline Customer Advocate, which is partly funded by the airline businesses themselves.
Webjet’s earnings over the period were well above the same period last year and pre-pandemic, with its $47 million in net profit a $43 million improvement on 2023.
Bookings increased to 4.4 million, up from 3.4 million in the first half of 2023 and a 50 per cent improvement on pre-pandemic levels.
Webjet expects its full-year earnings before interest, tax, depreciation and amortisation to increase to between $180 million and $190 million, about 15 per cent above 2019.
Guscic said the “stonking result” was driven by a major cost-cutting program the business implemented in COVID-19 to streamline its technology and eliminate inefficiency across its travel booking, hotel and motorhome businesses.
Although Webjet and its hotels division Webbeds performed strongly over the half, motorhomes division GoSee is yet to return to pre-pandemic growth. GoSee’s $11m in revenue over the half was 30 per cent below pre-pandemic levels.
Guscic said GoSee’s lagging results were due to the sustained lack of inbound tourists into Australia and New Zealand, a hangover from COVID-19 and reduced airline capacity.
“Inbound tourism is still severely hampered beyond visiting friends and families on short-term trips…the travellers who want to spend three weeks in a motorhome are yet to come back to the market,” Guscic said.
The booking boss said he expected the travel industry to remain resistant to cost of living pressures over the next couple of years, arguing travel was no longer considered a discretionary item, but an essential service.
“Travel is up in every major market, future bookings by every major player are up. Every hotel chain, airline and global travel agency are all predicting growth in the next six months, so we’re not seeing a slowdown anywhere,” Gusic said.
But he did stress the way people travel has shifted. Customers have tended to book their travel later in the piece, and travel more frequently but for shorter periods.
UBS’ Tim Plumbe told clients the result was solid.
“Earnings beat [consensus forecasts] driven by stronger business to business bookings,” he said and added the cashflow generation over the half was “very strong.”
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