Global Business Travel Spend Projected to Exceed $986 Billion by 2013; China to Outpace U.S. in Growth
U.S. currently leads world in business travel spending which reached global outlays of $929 billion in 2008
The study predicts that growth of business travel in China and Japan will exceed U.S. growth over the next five years. In addition, developing nations, like India, Vietnam, Iran and Indonesia will experience significant compound annual growth rates over the same timeframe.
“Developing countries are proving to be fertile business-travel areas,” said Rob Greyber, president of Egencia. “Over the next five years, we’ll see countries like India and China grow at rates of 5.3 and 6.5 percent respectively, versus the U.S. projected growth rate of 0.3 percent.”
Global Business Travel Market & Outlook
“This study shows that business travel spend has increased by more than 35 percent since 1998, making it an impactful industry in the global economy,” said Kenneth McGill, NBTA Research Consultant and lead analyst on the IHS Global Insight report. “Most of this growth has been due to an expanding global economy and the rising dispersion of business travel activity around the world.”
Despite the United States’ position as the global leader in business travel spend, Asia Pacific is poised for substantial growth over the next five years, while U.S. growth is expected to stagnate. China’s spend, at $93.8 billion in 2008, has tripled over the past 10 years and is expected to lead market growth between 2008 and 2013, followed by Japan and South Korea. Measured in terms of the dollar increase in business travel spending, the United States is expected to be fourth in terms of growth, just behind India.
Business Travel by Industry Sector
The research shows that, globally, businesses spend an average of about 1.1 cents of every sales dollar on business travel, though it varies widely by industry. In the equipment and leasing sector, for example, the measure of travel intensity is more than three times higher at 3.7 cents per dollar, while in the mining sector, business travel measures only fractions of a cent per dollar of revenue.
Reflecting the global recession, nearly every industry foresees a decline in business travel outlays in 2009 from 2008 levels, led by steep drops in the transportation services, paper and paper products, construction, chemicals, communication equipment, and rubber and plastic manufacturing sectors. The only anticipated uptick in spending is expected in education with a 2.2 percent projected rise. However, there has been a downward trend in the amount of travel spending businesses require to support their sale and operational activities, which is a clear indication of the rising productivity of business travel.
“The increase in productivity highlights several major shifts within our industry,” said Greyber. “Stronger travel management and greater efficiency when traveling have both contributed to this change, essentially driving down business travel spend per revenue dollar. This development should be a key consideration in program planning, in addition to overall macroeconomic changes and sector trends.”
The full study, conducted by IHS Global Insight, will include a complete profile of U.S. business travelers, as well as a comprehensive forecast of U.S. and global business travel activity. Additional findings will be shared in a public webinar on August 6, 2009 at 12:00 p.m. ET/9:00 a.m. PT and during education sessions at the 2009 NBTA International Convention & Exposition August 23-26 in San Diego. To register for the webinar, please visit .
Study Methodology | NBTA/IHS Global Insight used a combination of public, private, and custom survey-based data to compile this exhaustive analysis of global business travel. Demand-side measures collected directly from business travelers were combined with data from travel suppliers and various governments/NGOs in order to create a definitive set of business travel metrics. NBTA/IHS Global Insight also sponsored a survey of a representative sample of U.S. businesses across industry groups seeking an array of questions regarding travel & entertainment expenditures and managed travel activity. Finally, IHS Global Insight created a comprehensive econometric model used to project future business travel performance and related business travel spending to corporate performance.
About NBTA | The National Business Travel Association (NBTA) is the world’s premier business travel and corporate meetings organization. NBTA and its regional affiliates – NBTA Asia Pacific, the Brazilian Business Travel Association (ABGEV), NBTA Canada, NBTA Mexico and NBTA USA – serve a network of more than 15,000 business travel professionals around the globe with industry-leading events, networking, education & professional development, research, news & information, and advocacy. NBTA members, numbering more than 4,000 in 30 nations, are corporate and government travel and meetings managers, as well as travel service providers. They collectively manage and direct more than US$200 billion of global business travel and meetings expenditures annually on behalf of more than 10 million business travelers within their organizations. For more information, visit .
About Egencia, an Expedia, Inc. Company | Egencia, an Expedia, Inc. company, is the fifth largest travel management company in the world. As part of Expedia, Inc., (NASDAQ: EXPE), the world's largest travel marketplace, Egencia helps business get ahead with a complete corporate travel offering supported by best-in-class online and offline service, and global market expertise. With real-time availability of data and customizable reports that are integrated globally, Egencia is committed to helping increase efficiencies and savings by giving its customers more insight and control over their travel program. Visit:
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