UK corporate travel leaders have hailed a strong recovery in the sector with a majority reporting business ahead of 2019 levels, according to Suzanne Horner, chair of the Business Travel Association (BTA).
However, claims that corporate travel has returned to pre-pandemic levels do not tally with reports by major network carriers that business travel volumes remain significantly below those of 2019.
Horner, chief executive of Gray Dawes, told the BTA conference in Antwerp: “Most people report being ahead of 2019.”
Leading BTA members agreed. Maria Baty, managing director of Altour, insisted: “Corporate travel is back and [demand] very robust. There is no plateau – it’s getting stronger.”
Flight Centre Europe chief financial officer Adam Murray argued: “We’re no longer talking about where we are in relation to pre-Covid. We’ve seen a significant rebound in the last year. We all see our businesses back.”
Kevin Harrison, managing director of Good Travel Management which recently acquired Wexas Travel Management, conceded “the whole market may not be there” but insisted: “Demand in the managed travel sector is there. It’s stronger [than pre-Covid].”
He suggested: “SMEs have come in which were unmanaged previously.”
Murray agreed “it’s the unmanaged space” that remains down on 2019, although he told the BTA conference: “There have to be some losers in the room.”
However, British Airways parent IAG and the Lufthansa Group reported corporate bookings 30%-40% below 2019 levels in recent quarterly results.
IAG chief executive Luis Gallego suggested corporate bookings had “plateaued” since March and reported that, while BA’s corporate travel revenue was “around 69%, volumes [are] 60%-61% of 2019 levels”.
Lufthansa Group chief executive Carsten Spohr similarly noted business travel had “recovered to about 60% of pre-crisis passenger numbers” and suggested: “German corporate travel will, in our view, remain structurally smaller.”
Spohr forecast corporate demand would only recover to 70% of the 2019 level by the end of this year, while BA forecast 68%.
Major US carriers have also reported business travel bookings levelling off at about 75% of 2019 levels.
Senior industry figures acknowledged the mismatch between the assessments of travel management companies (TMCs) and airlines.
Pat McDonagh, chief executive of Clarity Travel which acquired TMC Agiito in August, told Travel Weekly: “Business is not back at 2019 levels in terms of number of transactions. [But] the revenue of companies is back because air fares have risen 40%-50%.”
He noted a series of impediments to a full return in the sector, saying: “You have more distributed workforces. Corporate rail travel is not back [to the level it was] because of the state of the rail network, and airlines have restricted capacity.”
Mervyn Williamson, chief executive at CTM, agreed telling Travel Weekly: “We can’t be at the same level [as 2019]. Airline capacity is down. We have clients doing less [travel] than they were. But fares and prices are up. Most TMCs are probably making a higher yield [than in 2019].”
Leading industry accountant Chris Photi, head of travel and leisure at White Hart Associates, pointed out: “The level of consolidation in corporate travel indicates the level [of demand] is not where it was.”