BackSpending in international business travel won't improve until 2026 - here's why
Spending on international business travel will take 18 months longer to return to pre-pandemic levels.
PremiumIssues like prolonged inflation, high energy prices, labour shortages and lockdowns in China would likely lead a rebound in global business travel spending to pre-pandemic levels to be postponed by 18 months to 2026, according to a new industry projection.
According to the Global Business Travel Association (GBTA), North America led the recovery in 2021 as business travel spending increased by 5.5% to $697 billion, but this was still far below the $1.4 trillion levels seen in 2019. The recovery projection is less optimistic than the GBTA's previous forecast, which predicted a full recovery to 2019 levels by 2024.
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According to the prediction, the demand for travel is also being affected by issues with environmental sustainability and the regional effects of the conflict in Ukraine.
"The factors impacting many industries around the world are also anticipated to impact global business travel recovery into 2025," GBTA CEO Suzanne Neufang said in a statement. "The forecasted result is we'll get close, but we won't reach and exceed 2019's pre-pandemic levels until 2026."
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Global Business Travel Group Inc, the company that owns American Express Global Business Travel, the largest corporate travel agency in the world, stated last week that although the impact of a potential recession was not factored in, revenues were anticipated to average around 65% of 2019 levels this year.
In order to cover the void left by the drop in corporate travel during the epidemic, airlines and hotels have been banking on robust leisure demand.
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Meanwhile, London's Heathrow Airport stated on August 15 that it would extend its daily passenger cap until the end of October in an effort to accommodate the rising demand for air travel while dealing with a personnel shortage.
Up to 100,000 people per day may depart from this airport, one of the busiest in Europe, through October 29. The daily maximum was initially expected to be increased on September 11.
(With agency inputs)
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