CAPA’s World Aviation Summit – premium travel: The great re-seat

Business travel is coming back, but not in the shape we're used to

While leisure travel has returned to pre-COVID-19 levels in most parts of the world, the return of business travel has been slower and more fitful.

Business travel spend remains below 2019 levels, and video conferencing, instant messaging and digital productivity platforms appear to have permanently replaced some corporate travel.

For airlines, particular network carriers who have historically relied on business travel, this would appear to be bad news. However, there are signs that business travel is coming back - although not in a shape that we are used to.

The pandemic changed much about the way people work, along with the 'whats, whys and hows' of travelling for business.

Business travel is being reimagined to account for a range of new trends

Business travel is being reimagined to account for a range of new trends - some of them broad social changes, and others that are more specific to the realities of post-pandemic corporate travel.

The rise of hybrid, remote and flexible working arrangements - now permanent and pervasive features of many workplaces - has created new classes of corporate traveller.

The 'road warrior' of the pre-pandemic period has been supplemented by the 'digital nomad' who wants to be able to work from anywhere, the 'blended traveller' who combines corporate and personal leisure travel, and remote workers who may be travelling to meet their colleagues for the first time, attend a company retreat or visit a trade show.

This is creating a raft of changes in the travel process, shifting everything from preferred days and times of business travel, meal and seat preferences onboard aircraft, and the type of accommodation and length of stays.

Corporations, particularly large firms, continue to reform and revise their business travel policies in the face of a challenging cost environment.

Travel budgets are generally lower, with firms attempting to squeeze more out of fewer, but longer, trips.

There is generally less appetite for risk, with fewer employees likely to travel and more oversight when it comes to employee wellbeing and spending.

Businesses are also aligning with their employees' changing priorities around their health and safety and work-life balance.

This has translated into employees gaining more power when it comes to accepting (or rejecting) travel opportunities. Employee reluctance to travel has eased recently, but remains elevated when compared to before the pandemic.

The corporate spotlight on sustainability has also become more focused, leading businesses to increasingly consider the environmental impact of their travel. Firms face increasing pressure to cut their greenhouse gas emissions as the global drive towards net zero continues to pick up pace, which may put another break on growth.

Despite all of this, business travel continues to inch back. Small- and medium-sized firms are leading the charge - particularly those that have been more willing to embrace the changes to travel policies that their workforces are seeking.

The pandemic also demonstrated that face-to-face meeting remain vital to the success of businesses, and there is no substitute for in-person attendance at events.

Insights from CAPA's World Aviation Summit

This was the topic of a panel discussion at the CAPA World Aviation Summit in Abu Dhabi at the end of Nov-2023.

The session was moderated by CAPA - Centre for Aviation, Head of Analysis, Rich Maslen and included insightful observations from Virgin Atlantic, CCO, Juha Jarvinen; Global Airlines, CEO, James Asquith; Beond, CEO & Chairman, Tero Taskila; and Al Futtaim, Group Head of Corporate Travel Services, Souhilla Taarabit.

Some of the topic areas covered included:

• How are airlines and airports accommodating the new breed of luxury-focused traveller?
• How have new working arrangements and the shift to 'bleisure' travel contributed to this trend?
• Do rising travel costs - particularly airfares, booking and entertainment - signal an end to the trend, are travellers new spending habits here to stay?
• Can business travel be re-invented and reinvigorated to accommodate new trends in working and budgets?
• Have the priorities of business travel suppliers and business travel buyers diverged?

You can view the full session via the following CAPA TV recording.

About the CAPA World Aviation Summit

The 2023 edition of the CAPA World Aviation Summit & Awards for Excellence took place in Abu Dhabi, in the United Arab Emirates. The event, held on 28-29 November, and hosted by the Etihad Aviation Group, brought together thought leaders from aviation and the wider travel industry, including airline and airport executives, key suppliers, technology partners and regulators.

The focus for the summit was the biggest trends which aviation faced in 2023, with global airline leaders sharing their insights and perspectives on the changes brought about in the aviation sector over the past year.

The topics ranged from rising costs, environmental sustainability, operational issues, international recovery, digital transformation, supply chains and more, and also provided some guidance on the future trajectory of air travel in 2024.

This year's event to be hosted in Belgrade, Serbia

With the air travel industry having undergone an immense shift over the past few years, it is more important than ever to understand the strategic and competitive landscape across the industry.

The 2024 edition, under a new name, CAPA Airline Leader Summit World & Awards for Excellence, is to be held on 21-22 November 2024 in Belgrade, Serbia. Hosted by the City of Belgrade and Air Serbia, the event will tap global aviation leaders for an exciting examination of the direction the aviation industry is taking.

It will provide unique global perspective, unpacking the changes that are shaping the way airlines, airports and sector suppliers are doing business.