Industry Research

GROUNDED: Too Many Biz Travelers Still Staying Put

Posted on August 19, 2009 by LCT Staff - Also by this author - About the author

NEW YORK — Business-class travelers aren't likely to return the world's airports before next year despite the outlook for an economic recovery this fall, according to industry watchers on Tuesday.

In a survey from the research arm of UBS, 35 percent of corporate travel managers surveyed said they couldn't foresee any new spending on air travel, compared to 33 percent expecting a pick up in spending by the first half of 2010. About 20 percent said they could see more air travel spending in the second half of next year, while just 12 percent said they expect more spending in late 2009.

"Abstinence apparently is the best policy," said UBS analyst Kevin Crissey.

The survey bodes poorly for airlines, which have seen their toughest year in decades as the recession caused many would-be travelers and businesses to tighten their budgets and forego any trips.

Airlines have responded by slashing airfare and cutting back in seat capacity, with the sharpest capacity cuts expected after the upcoming Labor Day weekend. That helped to fill up the planes, but industry revenue has fallen sharply as it was mostly leisure travelers taking advantage of the heavily discounted tickets.

And the number of people traveling is still falling. Over the eight-day Labor Day holiday travel period, the Air Transport Association forecast U.S. airlines would fly 3.5% fewer people versus last year.

Business travelers, on the other hand, typically pay a premium for higher-class seats and schedule flexibility.

Indeed, global premium travel revenue for the industry plunged 33% percent in the first quarter and 41% in the second quarter, according to the International Air Transport Association. In June, premium travel was still declining close to 40%.

There hasn't been any improvement in international business travel, though the decline has a least moderated with signs ahead that things will improve, the trade group said.

Source: MarketWatch/Seattle Times

For the rest of this article, CLICK HERE.

View comments or post a comment on this story. (0 Comments)

More News

5 Ways To Sell Into The Luxury Travel Market

It’s not your father’s high-end market any more. These lessons apply to chauffeured transportation as well.

Trump Travel Ban Could Deter Business-Related Trips

Tech firms and multinational corporations have lashed out at the move, and some recalled employees traveling overseas.

Half Of Companies Allow TNC Use For Business Travel

A GBTA survey finds an increasing number of traveling employees using companies like Uber and Lyft.

Study Shows Jobs Rose In Taxi Industry Despite Uber

The authors believe this is the first serious look at the effects of the gig economy platforms such as Uber on jobs.

What Trump Means For Fleet-Based Businesses

Fleet expert: "If Trump eventually rolls back regulations in the automotive sector, he would likely stimulate growth."

See More News

Facebook Comments ()

Comments (0)

Post a Comment

Submit

Blog

See More

LCT Store

LCT Magazine - March 2017 $12.95 INT'L LCT SHOW ISSUE COVER STORY: * Innovate or Die: Show To Be a Business "Disrupter" * *



Connect

Experience the three annual industry events for networking for business, showcasing vehicles and products, and getting the tools for success.

Read About Your Region

What’s Happening Near You?
Click on any state to see the latest industry news and events in that region.

More From The World's Largest Fleet Publisher

Automotive Fleet

The Car and truck fleet and leasing management magazine

Business Fleet

managing 10-50 company vehicles

Fleet Financials

Executive vehicle management

Government Fleet

managing public sector vehicles & equipment

TruckingInfo.com

THE COMMERCIAL TRUCK INDUSTRY’S MOST IN-DEPTH INFORMATION SOURCE

Work Truck Magazine

The number 1 resource for vocational truck fleets

Metro Magazine

Serving the bus and passenger rail industries for more than a century

Schoolbus Fleet

Serving school transportation professionals in the U.S. and Canada

Please sign in or register to .    Close