What’s Happening in Business Travel Right Now?
The idea that business travel has changed forever has become the under-statement of the year among Travel Managers and category owners. Clients and prospects typically just skip the obvious observation and get to the punch line and ask: “So what happens now?”
The same basic questions keep popping up so in the interest of efficiency let’s review them here. Some are straight forward; some require our decades of experience and predictions in the business travel industry.
Why is it so hard to find a rental car?
Most of the major rental car brands liquidated at least part of their rental fleets when the pandemic started and now are having problems replenishing these fleets due to the global microchip shortage used in automobiles. Among those traveling, we have found that prices have gone up significantly (if you can find a rental) and the use ride-shares such as Uber and Lyft have become not only more popular but approved as part of corporate travel policy. Plan ahead if you’re traveling.
Does my company need a new travel agent?
Unfortunately, you might. Travel shut downs led to massive furloughs and lay-offs. As travel started to rev back up prior to the Delta variant, many Travel Management Companies (TMC’s) started to re-hire but also found they struggled to keep up with customer service demands. In the meantime, many in business travel found career opportunities outside of the travel business. The result is significantly depressed businesses, a lot of reports of very poor service levels, and consolidation. Most industry experts expect a return to profitability among travel agents by Q3 2022 but many won’t survive that long. The need for a good travel agent will come back strong but your organization may find itself in a situation where it needs to find one who will be able to survive this difficult time. And be patient. No one is immune and if your travel agent says they are, be skeptical.
Is corporate travel dead?
No. As soon as corporate travel restrictions were lifted we saw an immediate return at least domestically in the U.S. Sales driven organizations understand that “being there” is half the battle in corporate sales. Business travel is not dead and it will come back. Formats such as video-conferencing will play a huge role but every study I’ve read about human behavior tells me that nothing matches in person meetings.
When will business travel resume?
We’ve seen resurgence even despite the Delta variant but not by a lot. By most accounts, corporate travel fell off 90% during the height of the pandemic and came back to around 70% before the Delta variant. We are seeing most advance booked International flights cancelled through November but for those traveling we are seeing a much higher degree of advance preparation and attention to federal, state, and local rules governing vaccination requirements and other protocol. Keeping in mind that the 4th Quarter tends to lag in terms of business travel even in normal times, most expect travel to stay depressed for the remainder of 2021 and assuming no more interruptions a slow return in 2022.
What is the future of business travel?
Business travel is a $1.6 trillion global industry that functions as a critical business tool for sales efforts, client engagement, and internal team building. Whether the role of business travel is diminished as a result of the pandemic or offset by other platforms is impossible to forecast with any certainty. But what is certain is that the role of business travel will remain a critical tool in support of a company’s strategy and one significant enough to warrant attention and optimization.
What is the business travel forecast for 2022?
By most accounts, business travel is expecting a robust rebound in 2022 with most Travel Management Companies and travel related suppliers expecting up to 75% of 2019 volume by Q322.
When will business travel resume internationally and domestically?
Domestically, it already has. Most large companies have lifted U.S. domestic travel restrictions but have continued to limit trips to the EU and other International locations due to the new Delta variant of the COVID-19 virus.
Will Zoom replace business travel?
We don’t think so. Most studies show that video-conferencing is not as effective as in person meetings particularly when dealing with sales situations. Certainly, these platforms have gained traction and many corporate travel policies are requiring this platform be considered in lieu of non-essential travel. So, we believe Zoom and other similar platforms will play a greater role in how companies communicate but will by no means act as a replacement.
Do I need a corporate travel consultant?
Corporate travel consulting can optimize any aspect of your company’s corporate travel program. Our team of corporate travel consultants has deep experience with regional and multi-national companies across the entire corporate travel supply chain.
Our team at KesselRun brings deep experience to every aspect of your corporate travel program. After 20 years in business, we still believe that every consulting engagement is as unique as our client’s business.