The business travel market has fundamentally changed in the short-haul sector with a continuing shift from air to high-speed trains, according to accountancy giant PricewaterhouseCoopers.
Improvement and growth in high-speed rail networks, the implementation of the European Union Emission Trading Scheme next year and mandates from corporates will reduce air travel over certain routes with rail benefiting, the firm believes.
Business travel, having suffered highs and lows during the recession, will continue to remain “super-cyclical”. The medium term outlook is positive with long-haul premium air travel returning, but a shift in short haul travel patterns will continue to hit short haul flights.
PwC partner David Trunkfield said: “Short haul business flights have taken a much bigger hit during the recession and have not since recovered and at the moment, we don’t see that this segment will ever return to its previous heights.”
A shift in the method of business travel in the future from air to rail, will further impact the short haul business travel segment.
Trunkfield added: “More than three quarters of journeys by PwC people to Paris and Brussels are now by train. This has increased with the introduction of High Speed 1 (HS1) and is likely to increase again when Deutsche Bahn destinations are available through Eurostar.
“This will throw another challenge in the direction of the airlines, as they see improving trends on their long haul networks but further pressure on their short haul ones.”