oh no there's another volcano will it affect your short-term rental in Bali stay tuned on the Bali business review and find out while I analyze a deep dive into volcanic activity and its impact on short-term rentals here in [Music] Bali so once again this is Jing with Market Insights here on the Bali Business Review and if you haven't seen recently there's been a volcanic eruption in East Nusa Tangada and this particular volcano I'm going to try to pronounce it slowly it is called Lucky Lucky okay so let's take a look at how this particular volcano
might have impact or might not have impact on rentals here in Bali first why does volcanic activity have anything to do with flights what is going on there so here's an interesting piece of trivia back in 1982 British Airways flight 009 was flying a 747 that was coming from London Heathro with stops in Bombay Koala Lumpur Perth and Melbourne so apparently what had happened was that this particular airplane right here seen over here this was the flight 009 and this is once again a 1982 so there was a a volcano it was called Mount Galong
and it was southeast of Jakarta and it threw up a volcanic ash the ash got sucked into the engines and what happens with volcanic ash is that it's high in silica content silica is of course the component of glass so what happens in a hot turbine engine that's sucking in a lot of the the base material to make glass is that it starts turning into kind of a glass jelly that then starts clogging and creating this bad effect on the airplane engine inside the turbine so what happens as a result of this ash being sucked
in and this jellification inside the turbines is that the engine stall thankfully all the engines were able to be restarted but you can imagine after an incident like that with engine stalling on a 747 carrying like four or 500 passengers they're not going to take chances again okay so what happens now is whenever there's a volcano then the flights are typically diverted around the volcano or in extreme cases they've been cancelled so let's take a look at this particular volcano today to see if it has any impact on let's say visitor arrivals to Bali so
the first thing we should check is to get an idea of the distance where exactly is Lewobi in comparison to our current position in Bali so let's go ahead and what we'll do is we'll go to our screen over here and we'll try to find it and so if you look for Lewobi you'll see that it is on this island this is one of the far eastern islands of Indonesia it is on the far east side of East Natada so the distance approximately between this particular point in Bali is let's go ahead and measure it
so we're going to go and use the really awesome measure distance tool in Google Maps and we're going to measure the distance approximately to Bali so we'll do a few lines over here going through West Nusatungara going through Lumbok and we'll hit the Bali airport and it's a little bit hard to see but there you have it it's approximately 524 miles sorry I'm happen to be in the US right now for those of you who don't use miles it's about 843 km which is quite a significant distance away that on a normal jet is about
a 2-hour flight from Bali so let's take a look and try to predict if this has any impact on Bali of course if the wind is blowing from the east to the west that would carry ash over across all the islands eventually to Bali which would then of course affect all flights coming to Bali but let's see which direction the wind is actually blowing so the wind if you take a look using a wind map this is a beautiful wind map that we have here this is under the windfinder website we can see that oh
thankfully at this point in the year all the major winds are blowing from the west so that means it's blowing across Bali across Nusa Tangara and blowing the ash to the east and there are some winds over here that you can see that are blowing the probably the ash to the south to where Australia is okay so that means essentially this that means this ash does not have a potential danger of reaching the Bali airport but it will fly into the pathway of some flights coming from northwest Australia such as perhaps Darwin or some of
these cities along the west coast of Australia and that might be the lead of some cancellations okay but are we talking about a large number of constellations let's go ahead and take a look at the flight schedules so if we go ahead and take a look at let's say some of the flights happening right now in fact in Bali we could see that of course there are still flights coming from the west about to land in Bali right now and there are flights also coming from the east so it looks like flights are still moving
on as usual by looking at flightaware.com that gives us air tracking on what's happening right now so that's strong evidence to see that the airport seems to be still functional but let's go ahead and zoom out a little bit and see what it looks like for flight schedules for that we go to the E Gusta Rai International Airport website where we can check on all the international flights that are about to come and the international flights as you can see all international flights for today or at least most of them seem to be on track
there's over what I would guess to be 30 flights and the finale of the evening is Singapore Airlines SQ0948 coming in from Singapore due to land at around midnight on the 24th of March now Singapore Airlines will fly they have some of the most rigorous safety standards of all major airlines almost an impeccable safety record so if Singapore Airlines thinks it's a good to go then it's probably okay all right so anyhow what does this tell us about essentially this volcano's impact to Bali nothing probably nil let's go double check to see if Airbnb has
a policy so we'll go to Airbnb we'll go volcano and we'll go eruption Indonesia let's see if they have an extenduating circumstance right now right now it does not look like there is essentially a Nope nope all right i don't see it disaster response tool in Bali okay that was in 2017 okay all right so far we did not see any extenduating circumstance cancellation policy issued by Airbnb or any of the other major travel platforms to forstall let's say extations for passengers unable to arrive to Bali due to the volcano okay so that's another indicator
of how serious a particular natural disaster is because generally speaking if there is essentially a serious natural disaster travel platforms will activate extenduating circumstance call and allow for penalty-free cancellations which so far hasn't happened yet okay all right so what does this mean in terms of overall activity and such historically Bali has not always been so blessed there have been volcanoes including Gunnong Aong which erupted in 2017 and continued in small eruptions all the way up to 2019 how do I know this because my wife's family are in-laws are actually from Karangasam in East Bali
they literally live in the shadow of Gong Aong not too far away so when the Okan was experiencing some sub and let's say pre- eruption activities the ground was already shaking there were some tremors and the geologists were warning for the families in that area to evacuate they fled they came all the way back down Jimbron to our part of the island which is about 80 or so kilometers away long story short the intense activity of volcanoes throughout Indonesia does present a unique risk to let's say short-term rentals but in a sort of mullified way
and I'll explain why so the actual experience of when we did have that volcano back in 2017 was yes it was bad because it did put Booket Vista the company that I'm the leader of out of business for a while it wasn't as bad nearly as co was far worse because it was far longer and there was no activity but it did make us in a hurry to expand our frontiers and eventually reach to Jakarta to look for properties that we could manage however the strange irony at the time was that even though there was
a volcano there was actually this somewhat balance of travel because as soon as flights canled that means no inbound visitors could come to Bali but no outbound flights were available so people who were stuck in Bali they would simply have to extend their stays but knowing that the volcano eventually led to let's say a closure of the airports that stopped anybody from planning future trips to Bali and that was very unfortunate and it did forstall performance in terms of investment value to many properties throughout the island for months so that was a unanticipated act of
God that was a risk now is this going to happen in the future indonesia is on the ring of fire so this is a digestible risk it is essentially a tangible risk is it going to affect you every day i don't know i'm not a vulcanologist i'm not a geologist and I would care to say that during my 20 years in Bali I've only seen one two three probably four volcanic eruptions that affected maybe about three or four months of overall booking activity over 20 years so that's 240 months so not necessarily a major risk
in the long term but however it can happen as you can see it does happen and I think the smartest thing once again is just to be well informed understand why it happens how it affects airplanes how airlines are essentially trying to defend themselves against such risk but also be smart and calculate that when you go and decide how you want to enter the market all right this is Jing again signing off from a short episode here in response to the volcanic eruption in East Nusa Tanga we hope that everybody out there stays safe stays
healthy avoid any misfortune out there in in East Indonesia and yeah another episode of Market Insights from the Bali Business Review signing off again if you like what you're hearing don't forget to comment or subscribe and we look forward to seeing you in the next episode [Music]
