The Global Business Travel Outlook for 2017
The Association of Corporate Travel Executives (ACTE) and the Centre for Aviation (CAPA) have joined forces over the past two years to run a range of excellent summit conferences focusing on business travel and business aviation in many parts of the world including North America, Europe, The Middle East and Asia. On November 21-22 their summit meeting held in Sydney focused on the key trends which are set to dominate business travel in the year ahead. I joined over 350 attendees including major corporate travel buyers, airline executives and business travel service providers.
ACTE has established itself as a highly successful global association of business travel service providers and major corporate travel consumers. It’s US based President Mr Kurt Knackstedt who is the CEO of Troovo chaired the conference. Globally respected aviation authority and CAPA Chairman, Mr Peter Harbison led discussion on the current and future trends for the global airline industry.
There were several key themes which emerged at the summit:
1. The age of growing political and economic uncertainty. Fairfax economics analyst Michael Pascoe pointed to the recent election of Donald Trump as US president and the British vote in favour of Brexit as two key events which are likely to influence the terms of trade around the world. Trump’s protectionist policies, if they are followed through during his presidency, could have a significant influence on global trade including bilateral airline agreements (especially those involving the USA) and the momentum towards open skies.
2. The power of disruptors, notably the rise of Air B n B and Uber are leading to major changes in the way business travel is being conducted. According to senior Air B n B executive Mr Bond Leung, Air B n B is making significant incursions into the corporate travel market and is actively addressing some of the traditional hotel industry’s major objections to Air B n B on the issues of security and duty of care.
3. Air fares were expected to remain at historically low levels during 2017. Peter Harbison of CAPA and Virginia Fitzpatrick, General Manager of 4D consulting (the business travel consulting arm of the Flight Centre Group) shared the opinion that both global air fares and Australian domestic fares are expected to remain steady over the year ahead. It is expected that a continuation of low oil prices, the growth of fuel efficient aircraft and increased competition coming from the growth of Low Cost carriers are expected maintain downward pressure on air fares.
4. Increased employment of mobile technology to provide an increasingly individualized service to consumers in all sectors of business travel. A theme which was supported by most speakers at the conference was that the provision of travel services was increasingly being pitched at the needs of the millennial generation. Their core expectations would be that travel services would meet specific individual requirements and their desire to be constantly on-line and the desire to combine business travel with leisure “me time”.
5. Growing concern about safety and security for international travel. Corporate travel providers and customers are expressing growing concern about safety and observance of duty of care from their companies and travel service providers. The spate of terrorist attacks in 2016 targeting tourists in Europe, USA and Asia was changing the perception that there are guaranteed safe havens. Business travel, which contributes over US1 trillion to global travel spending is set to continue growing in 2017.