Corporate air travel expected to pick up by April
NEW DELHI: Corporate bookings which made up a quarter of air ticket sales before the coronavirus outbreak are expected to rebound in the first quarter of FY22 as the economy continues to strengthen, experts said.
India’s largest airline IndiGo expects corporate and business travel at 80% of pre-covid numbers by April.
The airline, owned by InterGlobe Aviation Ltd, recorded 22% of revenue from domestic corporate and business customers till December 2019, which fell to just 8% in the subsequent months.
“We are seeing a very positive response from corporate houses, whom we have been interacting with,” IndiGo’s chief strategy and revenue officer Sanjay Kumar told analysts during a post-results call last week.
“And especially now, after the event of last year to this long hol
iday season of December, we are getting a sense that a lot of corporates are now beginning to travel,” he added.
Airlines charge a premium on
business travel, considering that they do not charge for a change in date, besides offering free meals and lower cancellation charges. The tickets, which are often booked in bulk, are 10-12% more expensive than general tickets, said Nishant Pitti, chief executive officer and co-founder, EaseMyTrip.com, a travel portal.
“Corporate bookings comprised just 40% of pre-covid due to reduced travel by corporates with many preferring video conferencing during the pandemic,” Pitti said. However, since January, business and corporate bookings have picked up, he added.
IndiGo’s Kumar said pharmaceuticals, infrastructure, construction, automobiles, and small and medium enterprises, besides other core sectors are gradually firming up their official travel plans, which had come to a standstill following the covid outbreak.
“The IT and the consulting sector are still taking some time. But, we hope that by the end of Q4 April onwards, they will also be flying,” Kumar added.
Other airlines also expect this segment to pick up.