View all newsletters
Receive our newsletter - data, insights and analysis delivered to you
  1. Comment
October 1, 2021

LCCs could experience rise in business travel demand post-Covid

As the world eases out of the pandemic, business travel is expected to return the slowest. In 2020, international trips fell by 75%, according to GlobalData traveler demands and flows database.

By Globaldata Travel and Tourism

As the world eases out of the pandemic, business travel is expected to return the slowest. In 2020, international trips fell by 75%, according to GlobalData traveler demands and flows database. However, as travel restrictions begin to ease worldwide, and government support schemes end, businesses must readjust their travel management programs to meet the financial constraints of the business. As a result, business travelers may switch from traditional legacy carriers and premium cabins to more affordable alternatives presenting an opportunity for low-cost carriers (LCCs) to gain a larger foothold in the business travel market.

Free Report
img

Build resilience in the face of COVID-19 disruption

COVID-19 has already affected our lives forever. The way we work, shop, eat, seek medical advice, and socialize will all be different in the future. Quite how different remains to be seen, but all industries must plan for multiple eventualities. Are you interested in actionable insights on the business challenges induced by the pandemic? GlobalData's cross-sector report analyzes the significance of this major disruptive theme across industry verticals. It provides side-by-side research of alternative datasets to present you with unique quantitative analysis of the effects of COVID-19 and how these differ across sectors. Additionally, it offers qualitative analysis of each sector and analyzes COVID-19’s impact on leading companies. Whatever your company’s imminent strategic plans, the long-lasting impact of COVID-19 must not be overlooked. Find out how to futureproof your business operations – download our report today.
by GlobalData
Enter your details here to receive your free Report.

Corporate travel budgets have reduced

According to a GlobalData poll*, 43% of respondents said their business has cut back significantly on its corporate travel budget, highlighting Coronavirus’s impact on business travel. With travel budgets scaled-back, business travelers could reduce flying altogether and stricter budgets could mean frugal travel decisions must be made. Low-cost carriers have a prime opportunity to position themselves more aggressively as a cost-effective alternative to the prestigious legacy carriers such as BA, American Airlines and Air France, to name a few.

The pandemic has changed business travel management programs. As a result of slashed corporate travel budgets, organizations will now urge many employees to find the lowest cost itineraries for their trip. Premium travel may be scrapped by some. Therefore, low-cost airlines have a significant scope to evolve its business travel proposition and target new demand.

The concern for full-service carriers (FSCs) is that LCCs have established products. In 2016, Ryanair crafted a bundle package, ‘Ryanair Business Plus’, which provides fast-track security, priority boarding and ticket flexibility. easyJet also offers a business plus memberships, with similar benefits. Other low-cost airlines are emerging in the long-haul space too increasing pressure on FSCs. Transatlantic flights with JetBlue and the anticipated launch of Norse Atlantic show that low-cost airlines are already testing the waters on traditionally high yielding business travel routes.

FSC’s need to adapt

This potential market behavior will put more pressure on FSCs. Cost is likely to be a deciding factor for most travelers, but business travel was more about convenience pre-pandemic. Full-service carriers need to find new ways to offer more value to businesses (not just passengers) and differentiate product offering. Strong relationships with TMC’s (Travel Management Companies) are essential because businesses are more likely to use a singular third party for procurement reasons. Further enhancement to business loyalty programs, such as the Emirates Business Rewards and BA On Business, is an ideal way to appeal directly to organizations looking to extract value from their travel programs. Nevertheless, in these testing times we are likely to see some exciting new product developments within the business travel sector from a multitude of airlines.

*GlobalData Poll, 347 respondents, closed 16th April 2021

Related Companies

Free Report
img

Build resilience in the face of COVID-19 disruption

COVID-19 has already affected our lives forever. The way we work, shop, eat, seek medical advice, and socialize will all be different in the future. Quite how different remains to be seen, but all industries must plan for multiple eventualities. Are you interested in actionable insights on the business challenges induced by the pandemic? GlobalData's cross-sector report analyzes the significance of this major disruptive theme across industry verticals. It provides side-by-side research of alternative datasets to present you with unique quantitative analysis of the effects of COVID-19 and how these differ across sectors. Additionally, it offers qualitative analysis of each sector and analyzes COVID-19’s impact on leading companies. Whatever your company’s imminent strategic plans, the long-lasting impact of COVID-19 must not be overlooked. Find out how to futureproof your business operations – download our report today.
by GlobalData
Enter your details here to receive your free Report.

NEWSLETTER Sign up Tick the boxes of the newsletters you would like to receive. The top stories of the day delivered to you every weekday. A weekly roundup of the latest news and analysis, sent every Monday. The airport industry's most comprehensive news and information delivered every month.
I consent to GlobalData UK Limited collecting my details provided via this form in accordance with the Privacy Policy
SUBSCRIBED

THANK YOU

Thank you for subscribing to Airport Technology