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“Go on holiday in Switzerland”

22.07.2020 – Theodora Peter

Tourism in Switzerland was booming only last year. Overtourism became a thing. Yet many hotel rooms lie vacant this summer. The hospitality sector is pinning its hopes on domestic holidaymakers to alleviate some if not all of the shortfall.

COVID-19 has turned tourism on its head

The spectacular high-alpine glacier view from Jungfraujoch is breathtaking, not least due to the thin air almost 3,500 metres above sea level. Europe’s highest railway station – successfully branded and advertised as the ‘Top of Europe’ – attracted over a million visitors last year, of whom 70 per cent had travelled from Asia. Then the lockdown came in mid-March, bringing tourism to a standstill for almost three months. “For the first time since the First World War, our trains stood still for longer than the duration of an alpine storm,” says Jungfrau Railways CEO Urs Kessler.

The 58-year-old from the Bernese Oberland has worked at Jungfrau Railways for over 30 years and experienced many crises along the way. “9/11, SARS, swine flu, and the 2008 financial crash – all these were nothing compared to COVID-19,” he says. Kessler broke off an advertising trip to Asia at the end of February to return to Switzerland – just in time. Two weeks later and everything had shut down. “2020 is turning into a really bad year,” he says.

Revenue down by a third

The virus and its consequences have had a severe impact across the entire tourism sector. Swiss hotels were excluded from the lockdown, but could not keep going after all other types of tourist infrastructure, including restaurants, were forced to close. “The situation has never been so alarming,” concurs Martin Nydegger, CEO of the Swiss tourist board Switzerland Tourism. His organisation predicts that the Swiss tourism sector will have lost up to 35 per cent in revenue by the end of the year. Not all hotels and tour operators will survive the crisis. A quarter of all businesses could go under, he fears.

The Swiss Economic Institute (KOF) at ETH Zurich expects overnight stays to fall by around 30 per cent, with the absence of visitors from other continents of particular concern. More than half of last year’s 40 million overnight stays were booked by foreign guests. Domestic guests can only partially offset the shortfall, even though the KOF expect ‘staycations’ to account for 10 to 15 per cent more overnight stays than they usually would in July and August. This increase will mainly benefit the mountain regions and Ticino. Urban tourism will lose out.

Holiday advice from Finance Minister Ueli Maurer

The federal parliament has approved a 40-million-franc loan for the beleaguered industry. This money will fund marketing campaigns aimed at encouraging tourism in Switzerland. The Federal Council has not planned any special bailout measures. Instead, the government has asked people to show solidarity. “Go on a staycation and spend your money in Switzerland,” beseeched the finance minister, Ueli Maurer (SVP).

The next few months will prove whether we have listened, given that other European countries will also have been doing their utmost to attract holidaymakers. With Schengen states due to lift internal border controls on 15 June, some Swiss will also fancy going on another beach holiday. At the same time, Swiss hoteliers will hope to welcome more foreign guests.

‘Clean & Safe’ in Switzerland

Meanwhile, Switzerland Tourism have launched the ‘Clean & Safe’ label – a campaign aimed at cementing Switzerland’s reputation among foreign and domestic holidaymakers as a clean and safe holiday destination. Hotels and tourism providers will use the label to indicate to customers that Switzerland also offers security and good healthcare in addition to pristine landscapes. Businesses that have implemented a safety plan in accordance with Federal Office of Public Health guidelines will be allowed to carry the label.

Competitive pricing but lower revenue

Apart from the job of gaining trust, pricing will also play a role. Many destinations are running special offers. For example, Jungfrau Railways have a ‘Corona Pass’ which they hope will attract visitors from Switzerland. Despite the expected decline in revenue, Kessler believes that his company will “emerge from the crisis stronger than ever”. He says that 2021 will be a transitional year before things return to normal in 2022. Tourism experts from the University of St. Gallen believe that it will take almost three years for international travel to recover.

Billions in aid for the Swiss aviation sector

The travel ban has left many airlines in financial straits – including domestic carriers Swiss and Edelweiss, whose planes have been grounded for months. Switzerland is providing its airlines with aid in the form of state guarantees worth up to 1.875 billion Swiss francs. This package includes around 1.2 billion francs in bank loans for Swiss and Edelweiss as well as 600 million francs for companies providing airline-related services such as cargo and baggage handling, maintenance, and catering. The companies assisted in the government bailout are not permitted to pay out dividends until the assistance has been repaid. These businesses must also adhere to government climate targets. The money is intended to help Switzerland’s airlines survive the coronavirus crisis and ensure that they continue operating. Swiss is a subsidiary of Lufthansa, which the German government plans to bail out with a 9-billion-euro rescue package.