Forecasting travel industry Can we Forecast the Recovery of the Industry? NuCom Group Follow Feb 8 · 3 min read by Sebastian Storfner As investment managers we have been wrestling with the question how long it might take for the industry to start its recovery from COVID-19. Our Investment Director Sebastian Storfner, who is looking after travel industry companies at Nucom Group, was searching for quantifiable leading indicators and came across an interesting analysis from Lufthansa Innovation Hub, where they looked at downloads for Chinese travel apps. App downloads can function as a leading, real-time indicator for customer demand. China started its lockdown about two months prior to Europe and already went through a full lockdown cycle. This is why Chinese apps serve well as a potential benchmark. Sebastian summarized his learnings for us: Based on data from App Annie, Lufthansa Innovation Hub looked at weekly change in downloads for the top five mobile airline apps in China. They found that China started to overcome decling air-travel demand six weeks (42 days) after the Wuhan lockdown. Airline app downloads show almost perfect V-Curve indicating that people are getting mentally ready to travel again when the end of the lockdown is insight. Since app downloads been turning positive, the daily flight volume at Chinese airports increased around 10–20%. This shows how app download trends correlate with the number of flight booking. Applying this methodology, we looked at the German mobility market. We might see similar trends, depending on how effective current measures to reduce the spread of Covid-19 are. German travel restrictions started around the 22.03.2020 (Bavaria 20th, Saxony 22nd). App downloads dropped sharply (-23%) during that week and have been declining ever since. It is almost certain that the recovery time might take longer in the Western hemisphere, given the drastic measures taken by the Chinese government to contain Covid-19. A peer group of mobility apps in Germany has been declining for 6 weeks. While the strong decline seems to be over, there has not been a sign of recovery yet. We are still waiting to see week-over-week growth in app downloads. (Graph 2: Week-over-week change in app downloads of major Mobility apps in Germany) To us, this would indicate that people are getting mentally ready to travel again and increase in booking should follow. We will see if this could be a method for real time indication to prepare a way back to the new normal. Until then we have to remain patient. Case Study Forecasting Travel Coronavirus 2 NuCom Group Insights NuCom Group is a strategic growth partner for digital consumer internet companies and a joint company of ProSiebenSat.1 Group and General Atlantic. More From Medium READ/DOWNLOAD%< The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It… Marquise Mata It’s time to stop feeling sorry for restaurants Gene Marks Sharp SVP Peter Weedfald: 5 Things I Learned From The Social Isolation of the COVID19 Pandemic Authority Magazine in Authority Magazine Voyagers Inside Cruise David Silver in Self-Driving Cars Free: The Bright Side of Surveillance Capitalism Griffin Kao Times Weekly Newsletter: Military-brat memories, Doge Disco, a challenge to St. Times Of Entrepreneurship Collaborative Consumption: Post COVID-19 Rebuild Strategy Shecluded Netflix New Feature May Soon Hit You Badly Kavish Kamat (KK) in ILLUMINATION-Curated