Business Travel’s Rebound Is Being Hit by a Slowing Economy
By the early fall, domestic business travel was back up to nearly two-thirds of its prepandemic level. But companies have now begun to cut back.
Business travel came back this year more strongly than most industry analysts had predicted in the depths of the pandemic, with domestic travel rebounding by this fall to about two-thirds of the 2019 level.
But in recent weeks, it appears to have hit a new hurdle — companies tightening their spending in a slowing economy.
Henry Harteveldt, a travel industry analyst for Atmosphere Research, said that corporate travel managers have told him in the last few weeks that companies have started to ban nonessential business travel and increase the number of executives needed to approve employee trips. He said he was now predicting that corporate travel would soften slightly for the rest of the year and probably remain tepid into the first quarter of 2023.
Mr. Harteveldt also said his conversations led him to believe that business travel would “come in below the levels airline executives discussed in their third-quarter earnings calls.”
Airlines were bullish on those earnings calls, a little over a month ago. Delta Air Lines, for one, said 90 percent of its corporate accounts “expect their travel to stay the same or increase” in the fourth quarter. United Airlines, too, said its strong third-quarter results suggested “durable trends for air travel demand that are more than fully offsetting any economic headwinds.”
