This year, business travel will begin to move past comparisons to pre-pandemic statistics. The Global Business Travel Association (GBTA) predicts spending will surpass 2019 levels in 2024. Business travel is rebounding due to both its necessity in companies’ day-to-day operations and the return of large events like conferences, put on hold or modified in recent years, as well as the 2024 Olympic Games in Paris.
Several industry trends will impact all aspects of business travel this year, including:
- Rate increases across transportation and accommodations
- Staffing challenges due to worker shortages and strikes
- The expectations millennials and Zoomers have for business travel
Your travel programs should also be aware of trends specific to air travel, car rentals, and hotels this year.
Airfare, which rose several percentage points above 2022 rates in 2023, is predicted to level out in 2024. Inflation, fuel costs, and labor all play a role in changing rates.
Distribution and Content Retailing Strategy
New Distribution Capability (NDC) went into effect last year, offering travel programs a more seamless and transparent buying experience. The industry continues to adapt to this shift in 2024 as more airlines and downstream technologies join the International Air Transport Association’s (IATA) data transmission initiative.
Boeing 737 MAX 9 Update
Following the January 5th incident on an Alaska Airlines operated flight that required an emergency landing after part of the fuselage broke off shortly after takeoff, travelers with a flight serviced by a Boeing 737 MAX 9 (used by both Alaska and United Airlines) may experience equipment and/or schedule changes. MAX 9s are returning to service once they clear the Federal Aviation Administration’s (FAA) safety check. However, this incident has the potential to continue impacting the travel industry as the FAA investigates.
Construction at Major Airports
Several airports are undergoing major renovations right now. These upgrades will make air travel more convenient in the coming years. Right now, the construction may impact accessibility and your travelers will need to plan accordingly, especially at JFK.
The Port Authority of New York and New Jersey is in the midst of a $19 billion redevelopment project at JFK. The project includes two new terminals, upgrades to existing terminals, and streamlined roads. At LAX, which is preparing for the 2028 Olympic Games with several projects, an Automated People Mover will connect terminals to parking lots and public transportation. Several terminals here are also undergoing renovations. Travelers at DFW, MCO, BOS, ORD, and other airports will also see construction, which could impact travel times.
Sustainability a Focus
While electric vehicles (EVs) may be attractive to programs with sustainability initiatives, others may restrict travelers’ electric or hybrid options due to their premium over conventional vehicles. Range concerns and a general lack of familiarity may be discouraging those travelers who do have the option from choosing to rent EVs. In a strategic decision emblematic of the state of the industry, in early January Hertz announced the sale of 20,000 EVs from its fleet, which represents two-thirds of its EV inventory.
Rental companies cut back on inventory at the beginning of the COVID pandemic and have struggled to recover since. The combination of increased demand for rental vehicles coupled with decreased availability of new vehicles continues to plague fleets. Ensure your travelers have the rental vehicles they need with strategic partnerships and early booking.
Like airfare, hotel rate increases are expected to be more moderate in 2024. However, costs are impacted by a wide range of factors and some cities and regions may still see double-digit rate increases.
Corporate travelers are different than even just a few years ago. Many now work from home some or all of the time. Millennial and Gen Z employees will make up 53% of business travelers this year. These employees expect flexibility and want to make the most of their time away from home. Bleisure travel, and the specific accommodations that lend themselves to both work and leisure, will become even more prevalent in 2024.
Much like other aspects of a corporate travel program, if sustainability is a priority for your organization, you can incorporate it into your hotel program by targeting new and existing hotel partners with sustainability initiatives.