Bill Connors, the executive director of the National Business Travel Association, urged limousine operators work with corporate travel managers on developing innovative solutions to managers’ tight budgetary constraints.
Business travel spending is rising again, in large part because more corporate travelers are getting out of the office again, Connors said at the State of the Industry presentation at the LCT Show here. But managers are under unrelenting pressure to keep a tight reign on per-trip spending.
More than three-quarters of managers responding to a recent survey said they have recently sought to renegotiate contracts with some of their travel suppliers as part an effort to more wisely spend travel dollars, Connors noted.
Citing the success that JetBlue and similar airlines, along with hotels, have had in attracting business travelers, Connors said that limousine operators who can draw lessons from those business models stand a good chance of gaining a leg up on their competitors.
More than 60% of recent travel managers responding to a recent survey said they expect to make more use of lower-cost airlines and hotels, he said. But, he added, that doesn’t necessarily spell trouble for luxury transportation providers.
Corporate managers are very interested in hearing about options that can provide their travelers with quality, service-oriented travel options at a reasonable price, he said.
He also noted that 56% of travel managers, a percentage that has grown in recent years, are now responsible for off-site meetings. This represents an opportunity for limousine companies who are savvy to the needs of travel managers and work at establishing close, rewarding relationships with them, he said.
Connors said that 30 limousine companies now belong to the NBTA as allied, also known as supplier, members.
In addition, Connors noted that a recent survey of NBTA travel managers found that nearly three quarters of them expect to see a rebound in business this year and into 2005.
The survey also found that nearly one-half of those surveyed report an increase in their company’s travel spending this year, with less than one in five experiencing a decrease.
He also noted that travel-related taxes and fees are now taking an inordinate bite out of corporate travel budgets. Taxes and fees now represent 26% of the average airfare, a higher percentage of taxes and fees imposed on alcohol and cigarettes.
These sin taxes are aimed at discouraging behavior, cautioning that high taxes could readily have a similar effect on business travel.