The number of business trips, and the cost of those trips, is set to rise in 2019, according to new research from AirPlus International. Its recently published 14th annual ‘International Travel Management Study’ shows that almost half (46%) of surveyed travel managers expect the global economy to affect business travel in a positive manner in 2019.
The survey of 777 corporate travel managers across 24 countries paints a positive picture for the corporate travel sector – the 46% figure is a significant rise on the 27% level recorded in last year’s study and the highest figure in the six years the study has asked this question. Only 16% of travel managers expect the economy to affect business travel in a negative manner, down from 20% in 2018.
But AirPlus International questions… are travel managers simply economic optimists? Their prognosis may seem surprising given the several risks that are threatening to slow the global economy in 2019, not limited to Brexit, slower growth in the Chinese economy and international trade disputes.
But this optimism is backed up by the International Monetary Fund with forecasts global GDP growth of 3.7% for 2019 (slower than 2018 but still a relatively high figure). “Business travel volume and GDP have long been shown to correlate,” says the global provider of business travel payment solutions.
Almost half (45%) of the corporate travel managers surveyed expect their company to travel more in the year ahead, up from 35% in 2018 and the highest since the global financial crisis of the late 2000s. Only one in ten (10%) believe their company will travel less, while 44% expect no change.
The responses, as you would expect, show a clear regional division – India has highest number of travel managers (83%) forecasting more trips in 2019. In contrast, one in three (33%) Russian travel managers predict less travel, more than any other country.
The almost inevitable consequence of more travel is more cost, and over half (51%) the travel managers expect their company to increase its travel spend in 2019 – up almost a quarter on the 41% level in 2018.
These increased corporate travel dynamics highlight the importance that business travel has gained over the years,” says AirPlus International in its report commentary. “Regardless of any possibly positive or negative effects of the global economy, travel managers consider business travel to be necessary and essential in order to gain new business and meet corporate challenges,” explains its marketing director Yael Klein.
But more travel also means companies will need to pay increased attention to controlling their rising spend. Ms Klein says “2019 is definitely the year to put this good travel management practice in place, or review them if you already have a strong managed programme.”
Action points recommended by AirPlus International to control potentially rising budgets include using a good corporate payment solution providing the best possible travel spend data; reviewing policy to identify fresh potential savings; re-visiting supplier deals with any additional potential spend; and communicating with travellers that costs are increasing and to focus on spending wisely.