Planes, Trains, and Automobiles: An Update in Business Travel

If you’ve been to any major airport this summer, you might have experienced crowds and long lines. The rise in the number of flyers to pre-pandemic levels has taken the airline industry by surprise, with some air carriers unprepared to handle their routine flights due to labor shortages (after laying off about 90,000 full-time workers in 2020) and expectations that leisure travel would return to normal at a slower rate. Airlines have canceled hundreds of flights, leaving people stranded. Now they are gearing up for business travel, anticipating a return of meetings, conferences, and events, and making plans to ensure that things go much more smoothly.

For example, in a recent article in The Wall Street Journal, Delta Air Lines said it’s adding back flights this fall in business centers such as New York and Boston, while at the same time scaling back on flights to vacation destinations. “We’re pivoting our capacity to now supplying more business seats,” said Joe Esposito, Delta’s Senior Vice President of Network Planning.

American Airlines has also made some changes, adding capacity to New York and Chicago in the wake of signs that corporate travelers are returning. There have been more bookings for single-day trips with no checked luggage, typical of business travelers.

The airline industry in general notes that companies are slowly sending employees on the road again. Domestic business travel, in fact, climbed to nearly 40% of 2019 levels. While expectations are that more corporate customers will take to the skies in the coming months, there is caution as the number of COVID cases rise. If a return to the office is postponed due to the highly contagious delta variant, the business travel rebound will likely be postponed.

Hotels Cautiously Optimistic on the Return of Business Travel

Hotel CEOs also expect to see more business travelers as people return to their offices and begin to schedule face-to-face meetings and attend in-person conferences and trade shows. For example, in an interview with CNBC back in May, Hilton CEO Christopher Nassetta noted there are reasons to be optimistic about the recovery of corporate travel following the prolonged pandemic-related slowdown.

“Business travel, while it’s lagging, it’s coming back. It’s probably about half the levels that we saw at the prior peak,” Nassetta said. “Group and events are lagging that, but they’re coming back.”

Of course, these and other comments made by hotel executives are predicated on offices reopening in the fall.