How Covid-19 May Permanently Shrink The Business Travel Market
When Covid-19 shut down economies around the world last spring, it also stopped all those trips business executives make to customers, suppliers, conventions, trade shows, and their company offices. Almost overnight, millions of people globally began working from home and using video-conferencing technology to transport themselves to meetings and negotiate deals.
Eight months later, the situation hasn't changed dramatically when it comes to business travel. And, there's mounting evidence that the category — the most profitable for airlines and other hospitality companies — may never fully reconstitute itself. At the very least, we anticipate business travel to remain depressed through 2023.
The biggest disruption is expected in the internal travel category that makes up 40% of business travel. This includes trips between offices within a company or to conventions and trade shows. We expect a long-term contraction of as much as 10% in business travel overall as employers and employees become increasingly comfortable with doing business over video-conferencing apps. Another factor holding down business travel is the reluctance to fly internationally and recent lockdowns in major cities in Europe.
