Business travel is flatlining, and here’s why you should care

by Christopher Elliott on July 27, 2009

Business travel projection

Bad news: Business travel is flatlining, and will continue to flatline for the next four years, according to a new projection from Egencia and the National Business Travel Association. More bad news: It’s probably going to affect your next vacation.

Why? Because business travelers subsidize discounted rates that leisure travelers pay. Have been for a long time, actually.

So what happens when the business travelers stop traveling for business?

If you said, “we pay,” you’re right. Either the price we pay for hotel rooms, rental cars and airline tickets — especially airline tickets — will have to go up, or we’re going to see some big names in the travel industry go down. I’m talking about several airlines, a car rental company or two, maybe a major hotel brand.

As a percentage of the world’s business travel, the decline is even more dramatic.

Business travel as percentage

Whether prices rise or travel companies fall, the next few years may not be the best for leisure travelers.

Airlines, car rental companies and hotels will probably lean on leisure travelers to make up the loss from business travelers. Meanwhile, the companies that rely on business travelers (full-service hotels and legacy airlines) are bound to struggle and eventually fail, unless they can find a better business model.

Jeff Goldblum said it best in The Fly: Be afraid, be very afraid.

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