Business Travel Has Peaked. Here's Our Future
There is no joy in recognizing that business travel has peaked and that our industry will never return to its pre-Covid level. Like it or not, there are significant implications for our industry's future.
Why Business Travel Has Peaked
Yes, the Covid-19 pandemic will recede and business travelers will feel safe about traveling, as will their hosts. Getting a global green light on the health and safety front will unleash demand for business travel. Unfortunately, that demand will be sharply and permanently diminished for these four reasons:
First, the pandemic has forced most employees to work from home. While not everybody's cup of tea, working from home will remain a popular choice for many workers and their companies in the post-Covid world. If you don't need to go to the office to work, why do you need to travel?
Second, the massive shift to working from home has forced the widespread adoption of virtual meetings. These have proven to be mostly adequate (not great!) substitutes for meeting in person. If you can meet virtually, why do you need to travel?
Third, the sustainability issue is rising on executive and government agendas. Business travelers and their employers will increasingly factor a trip's impact on our climate into their travel decisions. No small number of trips will be eliminated for this reason alone.
Note the synergy of these three forces. They reinforce each other and will endure for a long time. There is no magic wand that will make any of these constraints on business travel disappear. Business travel will clearly shrink. But the biggest force that will sharply reduce demand for business travel is the CFO's logic.
Imagine every pre-trip approval request being met with the CFO's default response of "Why can't you do these meetings virtually? There's no travel cost, no travel time lost and no carbon emissions, right?"