{"id":5572,"date":"2023-04-26T13:08:34","date_gmt":"2023-04-26T13:08:34","guid":{"rendered":"https:\/\/aviation-news.info\/?p=5572"},"modified":"2023-04-26T13:08:34","modified_gmt":"2023-04-26T13:08:34","slug":"business-air-travel-is-not-back-yet-will-it-ever-be","status":"publish","type":"post","link":"https:\/\/aviation-news.info\/?p=5572","title":{"rendered":"Business Air Travel Is Not Back Yet: Will It Ever Be?"},"content":{"rendered":"

Corporate travel is a big market for airlines, particularly in the USA. Despite accounting for only around 12% of air travel pre-pandemic, the sector accounted for around half the airline industry\u2019s profit. It was also responsible for filling much of the premium cabin capacity, so, understandably, airlines are keen to have these travelers back.<\/p>\n

But are they back? The data suggests not yet. We caught up with Steve Solomon, Chief Commercial Officer at ARC, to see what the ticketing data says about\u00a0corporate travel<\/a>. He commented,<\/p>\n

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\u201cI think it’s still too early to say. If you asked, \u2018will it get back to 100%,\u2019 I’ll say, sure it will, but I’m not going to give you a date when.\u201d<\/p>\n<\/div>\n<\/section>\n

Research from Morning Consult suggests that\u00a0business travel<\/a>\u00a0in the United States trended up throughout 2022, but only very slightly. Domestic US travel rose from 8% at the start of the year to 9% by December, while international travel went from 5% to 6%. It\u2019s heading in the right direction, but rather slowly.<\/p>\n

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Bookings still down by a quarter<\/h2>\n

ARC data shows that, despite the increase over 2022, ticket bookings for corporate travel remain almost 25% below 2019 levels. As an important bread-and-butter segment of US airlines\u2019 customer base, the deficit is hitting aviation hard. As to what\u2019s driving it, Steve gave us some color on that, saying,<\/p>\n

\u201cPeople are not in their offices four or five days a week. When you look at the industries that were the heavy travelers pre-pandemic, like professional services, consulting, legal, etc, there has to be a client to visit in order to make that trip. That’s the laggard in corporate travel – these types of organizations were really powering it before COVID.\u201d<\/p><\/blockquote>\n

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In the Morning Consult research, this notion of traveling less is echoed in the statistics. Almost a third of workers said their company had made changes to its travel policies, and 60% noted that this included traveling less. More than half said the changes included limiting the types of trips, the people who travel, and more closely scrutinizing expenses.<\/p>\n

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Some business travelers are combining business trips with leisure travel – read about\u00a0the rise of ‘bleisure’ travel here<\/a>.<\/p>\n<\/div>\n<\/section>\n

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The changing landscape of business travel<\/h2>\n

The \u2018new normal\u2019 has seen more businesses embracing a hybrid work model. Whereas working from home was an exception pre-COVID, now, businesses are realizing the benefits that come with offering more flexible arrangements for staff. Steve noted that the reasons for travel have shifted, with more cases of companies traveling just to get together than have been seen in the past.<\/p>\n

\u201cSomething that we’re seeing a lot of is the way hybrid work has changed travel – it isn’t always about traveling to your clients. There’s also traveling that’s happening to get together within an organization, and being really purposeful about that.\u201d<\/p><\/blockquote>\n

Again, the research from Morning Consult backs this up. The top reason for travel remains attending conferences or seminars, but traveling for internal company meetings is the second most common reason for travel, on par with traveling for client meetings.<\/p>\n

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Will business travel rebound fully?<\/h2>\n

Throughout the pandemic, debates around whether business travel would ever get back to where it once was were frequent. With companies embracing video conferencing, remote working and collaboration technologies, perhaps business travel is never going to be quite what it was.<\/p>\n

The latest Global Business Travel Association (GBTA) report suggests that this will not be the case. The firm predicts increased spending in 2023, with 78% of travel managers expecting more trips to be taken over the course of the year. Steve agrees, but notes that the mix of traveler and reasons for travel could be permanently changed. He said,<\/p>\n

\u201cWe think corporate will continue a steady recovery, but it’s going to look slightly different in terms of the what and the how. In some jurisdictions, like the legal profession, a lot more is done virtually. And that’s probably not going to change.\u201d<\/p><\/blockquote>\n

You can watch the interview with Steve Solomon in full in the video below.<\/p>\n