CTC Outlook State of the Corporate Travel Industry June 2023

Transcript

Benson Tang:Hello, ladies and gentlemen. Good morning. Come on. We need all this energy, right? Thank you very much. Welcome everyone. Welcome to our Corporate Travel Summit here in Singapore. Now what I'm going to do today is to give you a quick overview of what's happening in the world. Then of course we talk about the pulse check in corporate travel and then the keyword sustainability. What is this, by the way? This is firecracker, right? Now, ladies and gentlemen, there is a very, very special meaning of firecracker in the Asian context. We all know firecracker drive away demons, bring us good luck. So I want all of you to stand up now, holding your clapping hand like firecracker. Firecracker. Firecracker. We do the exercise together. We have ten seconds, everyone. All right. Woo! Woo! Woo! Woo! Woo! Woo! Woo! Woo! Thank you very much. Thank you. So I hear you loud and clear. Everyone want to drive. COVID away. Thank you. Now today we have such a wonderful list of corporations joining us. I want all of you to give a big round of applause to yourself. Thank you very much for joining us. Thank you. And then we start off with the economy. All right. Now, this is a very recent photos. Three months ago in Beijing, the capital of China, we all talk about the big elephant nowadays—China, right? So three months ago, all the Fortune 500 head, including Apple's Tim Cook, including Amazon's Bezos. Including Tesla's Elon Musk, they were all in Beijing. Why? Because of the economy. Now, all of you sitting here are experts in the economy. Now, let's do a little warm-up exercise first. Whoever got this question right, you'll get a little bear from me. All right, now which company is ranked number 1 in Fortune 500 in 2022? Okay, now don't cheat, don't look at ChatGPT because ChatGPT will only give you the answer up to 2021. It is a wrong answer. Okay, now I'll come down. Anybody want this little bear? Yes. Who go fast? Who want to try? Pfizer. Hold on. Pfizer. Once again? Pfizer. What's your name? Denise. Brilliant name. Pfizer is very close, but not the right answer. But you still get a little gift. By the way, this is my gift ambassador, Russell, a university student in Temasek Polytechnic. Another person. Come on, Peter. Amazon. Wonderful guess. Amazon is number 2. Closer, closer. Oh, Apple. Apple. Apple. We all love Apple. Mike is here, but not yet, not yet. This gentleman first. This gentleman. That'd be Google. Google is top 10. All right, this lady, this lady, come on. Your name first. Hedwig. From which company? ST Engineering. Wonderful. What's the answer? Walmart. A big round of applause! It's yours! Thank you. That's right, Walmart is the number. Now, what's the general average revenue, you guess? Just shout a number. Any number. $580 billion. How many staff? What's the headcount? You guess. By the way, one more exercise. One more exercise. Tim, which company you are from? UOB. UOB. How many staff in your firm? 25,000. Wow, a lot of people. 25,000, far away from this company. John? Yes. Which company you are from? Workday. How many staff? Almost 20,000. A lot of staff, 20,000, but far away. Last, Adriana, which company you are from? Autodesk. How many staff in your firm? 12,000. Wow, a lot of people, 12,000. You know how many staff Walmart has? 2.4 million. 2.4 million people, ladies and gentlemen. Nearly half the population of Singapore, just in one firm. So think about it that way. If one staff spends $1,000 for one year just for traveling, It is talking about $2.4 billion just in one firm. That's the importance of corporate travel. That's why we are all here, why we are learning from each other how to run corporate travel in a better way, how to make sure your firm under your leadership in managing corporate travel can make sure your staff perform for your firm. Now let's have a bird's eye view from the top. First, we start very strategic number. I will show, uh, some of the infographic slide here. You don't have to take photos because we will share the slide with you after this summit. All right, is it the end already for COVID? Now, 3 and a half years passed already with COVID Are we at the end? WHO, World Health Organization, telling us we are no longer constituting COVID as a public health emergency. However, is it gone? WHO are telling us we must continue scrutinizing The situation, so it's not yet disappeared. Now let's look at the economy. The overall economy, particularly in the GDP growth in the world, sluggish a little bit. Next year, data showing us roughly between two to three percent global increase only. And most of the locomotive of the economy coming from this part of the world, and I'll show you why later on. And then inflation is another very, very key factor. And of course, last year particularly, our inflation rate globally so, so high. This year a little bit better, and we hope the trajectory will be going a little bit better next year. One of the most important factors affecting our lives is the price of the fuel. And last year in May, we saw a peak in the jet fuel. It's going down continuously, and let's hope the trend would go on that way. However, there are many, many, many factors that could contribute to, you know, the fuel price ups and downs. For example, the geopolitical situation, the war in Russia and Ukraine are still going on. So there are uncertainty on that. Now let's have a pulse check on the airline data. Now, if you are in the airline industry, I'm sure you know the RPK. This is industry jargon, revenue per kilometre. Now, if you are in the airline business, congratulations, the RPK rebounds significantly. That means profitability. But if you look at the data of international air ticket versus domestic air ticket, the slide on the right, the blue graph Domestic flight increased significantly already. It's more than pre-COVID time already. However, if you look at international flight, it's still down. So there are rooms for improvement. Now let's do a pulse check on corporate, you know, economy. Now why earlier on I explained the locomotive of the economies from Asia because of this. RCEP. RCEP is the latest international free trade zone treaty that signed, uh, you know, in 2020, and it basically, uh, rolled out, um, last year, 1st of January last year, and since then it continued to grow significantly. And there are altogether 15 countries in this free trade zone. 30% of the total world population covered in this zone. And very glad Singapore under ASEAN is one of the participating countries. So 15 countries altogether. And you know what? After a year and a half, China's economy With United States or with European Community are already behind the economy between China and these 15 countries. So ASEAN countries right now become China's number one economy states. So this treaty. has a lot of effect. Now, another very important treaty I would like to bring your attention is called DEPA, the Digital Economy Partnership Agreement. And this agreement, I can guarantee you, will be the next very important international treaty. It's because of digital economy. We all talk about digital economy nowadays, right? We buy stuff in Taobao, in Amazon, you know, all these, you know, digital ways. So who will be leading, setting the rules in the future for international digital trade? Very highly probable, this new treaty, DEPA. Now let's look at corporate travel. We all know 2020, with the outbreak of COVID dropped significantly, but we are rebounding, and we hope next year we will recover back to pre-COVID period. And if we look at the breakdown of the domestic flight distribution, and you see all regions are rebounding quite well. International We know Asia is still in a recovery stage, mostly because of China, because if you remember, China just opened up with international border since February. So it picks up slower than the other region. And of course, if you look more details in the China situation, The domestic flight really, really rebounds, but international flights are still highly below COVID period. Intention of traveling. This is one research that asks travel managers around the world, what's the intention? And we see the yellow bar. Majority still think travel will be the same. And we are particularly interested, of course, face-to-face meeting, business client meeting, basically is at par. However, internal training or internal meetings, that will be a little bit, you know, changed. And the structure of the traveling will be changed. Now finally, in the remaining few minutes, I would like to talk about this word, sustainability. Very, very important. Everybody talking about sustainability. Now this is what's in Bloomberg. Bloomberg forecast in 2030, 5% of the global aviation fuel will be in SAF. And this is from Cathay Pacific. Cathay Pacific's CEO Ronald Lam made a bolder pledge 2 months ago in the financial results conference. Cathay is doing extra. 10% of SAF will be used in the entire Cathay fleet at the year 2030. And Cathay even invested a lot of money in this factory in America called Falcon, which is an environmentally friendly SAF. Finally, I would like to share with you our parent company, Informa, as a case study. Always from top down, many firms are from top down, C-level people, and this is our global CEO, Lord Stephen Carter, and we created this report, sustainability reports, for a few years already. And this is a long, long page, 47-page report this year we published. And you see the importance of business travel. Business travel is in point number 3. You can actually download that report on our website. So all in all, I would like to finish my first presentation With a wonderful quote from Charles Dickens' Tale of Two Cities. And it says, it was the worst of times, it was the best of times, it was the season of darkness, it was the season of light, it was the winter of despair, it was the spring of hope. Thank you. hope. So with that, ladies and gentlemen, let's enjoy our summit. This is your summit. Engagement is the keyword. I'll come back to stage with your engagement later. Back to you, Michael. Thank you. Thank you.

Copyright policy: All transcripts on this site are the copyright of CAPA - Centre for Aviation. Our reproduction policy is as follows: you may quote up to 400 words of any transcript on the condition that you attribute the transcript to CAPA - Centre for Aviation and link to the original video page. All other use is prohibited. While we aim for 100% accuracy in the transcript, there may be some minor transcribing errors.