"Plans to overhaul the current travel traffic light system to a stop-go system and to scrap testing requirements for the double-jabbed will deliver more clarity for consumers and should boost consumer confidence; but changes after the peak summer period could be too little, too late for many travel operators," Bell said.
"If traditional winter sun destinations remain on the red list, it’s hard to see where the financial lifeline will come from this year."
He also said the sector is heading for an "acute financial pinchpoint" with the next ATOL renewal deadline and the end of furlough colliding on the same day at the end of the month, which will apply "acute pressure to the finances of many operators".
"This perfect storm could mean some don’t have sufficient funds to renew their licences; and turning to the bond market to fill the gap appears to be off the table due to increased risk in the sector," he added.
The CAA said 510 of the potential 1,127 travel companies – just over 45% – were yet to apply to renew their Atol. It urged the remainder to submit renewal applications “well before” 30 September to avoid a delay to processing.
"To protect viable businesses and jobs across the sector, the government needs to step in now to provide further tailored grants and potentially extend the furlough scheme for travel related businesses to prevent high levels of business failure across the sector," Bell concluded.
