Business trips are recovering, but airlines say corporate customers are traveling about half of 2019 levels, and September and October will be a key turning point as offices reopen.
Southwest Airlines CEO Gerry Kelly said in a second-quarter earnings announcement for the airline, “Business revenues continue to lag behind leisure revenue trends, but to improve business revenues in the second quarter of 2021. I am encouraged. ” Kelly added that Southwest Airlines continued to “steadily improve weekly business bookings” in July 2021.
As most of the major airlines report revenue, some important themes have emerged.
- Sales and consulting travel has picked up.
- There is a 4-6 week delay between a business trip and a full office reopening.
- It is unclear how hybrid work will affect travel.
- And once the deadlocked demand is resolved, it becomes more unclear what the business trip will look like. Some airlines are betting on a full business trip rebound in 2022.
- At least one airline is betting on full travel recovery-based demand from industries such as finance, insurance, consulting and accounting.
- The company pays the same fares as it paid before COVID-19.
Measuring business trips when the office reopens is to find out where the company’s money is actually heading and whether video conferencing can permanently reduce the level of hopping on the company’s planes. , Worth considering.
Please see the state of the business trip.
American Airlines President Robert Isom:
The business trip began to return in a meaningful way.Domestic Business Revenues-Was Approximate [20%] It reached 2019 levels in March, but more than doubled to about 45% in June, with SME revenues recovering at a faster pace than large corporate accounts. The economic recovery is expected to continue and accelerate in the future. Over the next few months, the share of bookings in major business channels will exceed 2019. Customers also say they are enthusiastic about traveling, some of the largest corporate accounts have already lifted all travel restrictions, and many are already in the office.
Currently, a full business trip recovery is expected in 2022. Traveling abroad, especially long-distance trips, is expected to take some time to fully return.
United Airlines Andrew Nosera, Chief Commercial Officer:
Business trips, which fell by more than 90% compared to 2019 in most of the second quarter, changed sharply in June and are now down about 60% compared to pre-pandemic levels. With a new budget cycle, first at the end of summer and second at January, we see two more inflection points in demand within the business. By the end of the third quarter, business demand is expected to decline by approximately 40% to 45% compared to 2019. A recent survey of business customers shows that more than 90% have plans to return to travel, including overseas travel, in the second half of the year. Of ’21. This is an increase from about 55% earlier this year.
We have already confirmed that advance business bookings for September are currently down by only about 50%. And we expect that number to continue to improve and end the month, down about 40% to 45% based on the current situation.
Glen W Hauenstein, President of Delta Air Lines:
Corporate travel volume accelerated in May and June, with nearly 95% of accounts booked for travel in June. Also, in traditional business-rich markets such as New York City and Boston, consulting and sales-related travel has revived and transaction volumes have begun to increase. According to recent corporate survey results, more than 90% of corporate accounts forecast an increase in travel volume in the September quarter, from just 33% in the March quarter. In addition to these findings, close collaboration with our customers builds confidence in accelerating business trips, especially during the post-Labor Day period when schools and offices continue to reopen.
Domestic trading volumes are expected to recover from 40% at the end of June to between 55% and 60% at 2019 levels by the end of September. Global COVID recovery trends are volatile, but overseas travel is accelerating, with capacity and load factors increasing towards the fall.
Ed Bastian, CEO of Delta, said:
With more and more offices open across the country, people are reconnecting with their businesses and with each other. 72% of our employees have been vaccinated and officially reopened in June last month. And when I interact with other CEOs, I encourage you to hear about their own plans to accelerate their return to the office. That sentiment has been clearly communicated in recent corporate surveys, showing that nearly 95% of accounts will be back in the office by the end of this year.
What the airline is saying about resuming a business trip
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