Death of business travel has been greatly exaggerated

During the dark days of travel restrictions, European airlines provided a neat demonstration of the limits of virtual meetings. Top airline chiefs on video link at an annual industry summit in 2021 were left bemused when an online panel unravelled as the moderator’s line failed. The host returned after CEOs tried to fill the time talking about their holiday plans, but disappeared again after falling off his chair. It was more engaging than many conferences, but also proved a point: Predictions of the demise of business travel following the rise of video conferencing platforms such as Zoom and Microsoft Teams were off the mark. Microsoft founder Bill Gates predicted that more than 50% of business travel would disappear, and even some senior airline industry bosses thought a significant chunk was gone forever. But in reality, executives have been quick to abandon video calls and get back on the road. Like many changes that seemed permanent during the pandemic, old habits have steadily returned. Most strikingly, InterContinental Hotels Group has reported that corporate travel demand and revenue in the United States has already returned to pre-pandemic levels. At US airline Delta, business travel has recovered to “somewhere in the mid-80s” per cent of normal levels, while the recovery is slower but building in Europe. British Airways owner IAG said corporate bookings had returned to 70% of normal, and it was aiming to get back to 85% this year. Corporates are still lagging behind booming leisure travel, but previous downturns suggest that business trips typically take longer to come back, meaning there should be room to grow further. McKinsey has calculated that international business travel from the US took five years to fully recover from the global financial crisis, while leisure travel was back within two years.<br/>