BTN's 2011 Business Travel Survey: At The Crossroads
Many travel buyers this year find themselves in uniquely challenging positions. Their companies are healthy and growing and must continue chasing business wherever opportunities lie. That means more travel, and perhaps more corporate travelers. At the same time, the financial shocks organizations weathered, the procurement discipline they adopted and the scrutiny applied to every bit of spending has generated an ever-higher level of cost...
Many travel buyers this year find themselves in uniquely challenging positions. Their companies are healthy and growing and must continue chasing business wherever opportunities lie. That means more travel, and perhaps more corporate travelers. At the same time, the financial shocks organizations weathered, the procurement discipline they adopted and the scrutiny applied to every bit of spending has generated an ever-higher level of cost vigilance. The trick is to allow travel programs to meet corporate needs without losing sight of the methods used to make that travel efficient and productive.
Many business travel suppliers are at their own set of crossroads. Mid-2011 brings promise but requires caution.
In absolute terms, business travel is growing. Many corporate travel management companies listed in this year's 27th annual Business Travel Survey reported noticeably larger 2010 transaction volumes.
It was a clear year of recovery. With strong business transient and corporate group demand but new supply constrained, lodging companies, for example, are watching occupancies and average daily rates rise.
However, lukewarm global macroeconomic trends and social upheaval in some regions suggest the current post-recession period may be more challenging than typical financial recoveries. In the airline sector, for example, high-yielding business travel demand is strong and the current pricing environment favors higher fares, but any optimism is muted by fears about fuel prices, which can ruin otherwise positive financial performance. Among car rental companies, demand similarly is strong and fleets are tight, but intense competition has led to lower corporate rates so far in 2011.
The 2011 Business Travel Survey explores the trends and industry developments impacting corporate programs, preferred agreements and service levels for business travelers. To do so, BTN editors altered the makeup of this resource issue in an effort to provide more readable data, more relevant comparisons and a better snapshot of the health of the business travel industry's key supplier segments. For example, the annual chauffeured transportation section is not included, owing to a lack of public data and few meaningful comparisons in that highly fragmented business.
The airline section includes for U.S. carriers similar data as in years past, though certain general information has been replaced with corporate travel fare data. Given currency exchange complications and unaligned fiscal calendars, foreign airline companies are excluded.
In past years, BTN combined hotel companies and owners of large hotel portfolios, such as real estate investment trusts, and ranked them all by revenues. To produce a more succinct set of tables with information germane to corporate travel management professionals, BTN this year is providing key metrics—including average daily rate and occupancy—when available for the major hotel brands, as well as listing the net profits of publicly traded hotel companies. The real estate companies are addressed in a separate table.
As always, BTN appreciates the chief executives and owners of the 39 travel management companies who authorized ARC to release data, and again thanks ARC for providing that data to create an apples-to-apples comparison in the TMC section. BTN also thanks all the suppliers and industry sources who provided information and commentary, and looks forward to another year chronicling corporate travel.