Head winds for business f liers
Potential trade wars and an economic slowdown threaten a surge in business travel.
Spending on business travel has been surging over the last year, but that updraft is threatened by potential trade wars and an economic slowdown in the next year, according to a forecast by the global trade group for corporate travel managers.
“The direction of trade policy is far and away the biggest wild card that could impact our forecast for global business, creating uncertainty that could derail the recovery,” said Michael McCormick, executive director and chief operating officer of the Global Business Travel Assn., whose 9,000 members manage more than $345 billion in annual corporate travel spending.
The association said in a report released this month that spending on business travel has been rising between 3% and 5% a year from 2012 to 2016. Spending increased 5.8% in 2017 over the previous year — to $1.33 trillion — and is expected to jump 7.1% in 2018.
The trade group attributes the growth to improving economies around the globe. But the organization predicts the travel improvement will be cut short by rising interest rates in the United States, growing budget deficits in “both developed and emerging markets,” and “rising protectionism sparking potential trade wars.”
There is a direct connection between global trade and the business travel that supports trade, the group said, adding that the potential for a trade war “is the biggest global risk that GBTA is watching.”
The Trump administration has been calling in recent months for tariffs on products from several countries, including China, Canada and Mexico. Those countries have threatened to retaliate with tariffs of their own.
“Drastic increases in tariffs and associated retaliatory measures could have detrimental impacts on the global economy and the global business travel market,” the travel group said.
Airport adds rooms for nursing moms
The first of two pods designed to give privacy to nursing mothers has opened at Hollywood Burbank Airport.
The 9-foot, 5-inch-wide pod, created by a Vermontbased, woman-owned company called Mamava, is located in Terminal A, across from Gate A4. The second pod is scheduled to be added in September in Terminal B. The pods are free to use and are funded and maintained by the airport.
The addition of the pod marks the 500th lactation suite from Mamava, which has also created a free smartphone app that helps nursing mothers locate the pods and unlock the doors.
Hollywood Burbank Airport is the latest large commercial airport in Southern California to install a facility for women who need to nurse or pump breast milk.
Los Angeles International Airport has long operated eight nursing rooms throughout the facility. Ontario International Airport has two nursing rooms while John Wayne Airport in Santa Ana offers a lounge for nursing mothers, complete with a sink, upholstered chairs and artwork. Long Beach Airport opened two nursing rooms in 2016.
The Transportation Security Administration allows nursing mothers who pass through the screening checkpoints to exceed the 3.4-ounce liquid limit with breast milk, and the passenger doesn’t have to be accompanied by an infant. But the TSA asks that travelers remove the milk from their carry-on bags for separate screening.
Big f irms don’t do basic economy
Travel managers for big corporations love saving money, but most won’t let their employees book the cheapest fares on business trips, and the reason may have to do with how much workers can get done in the cramped, back-of-the-plane seats.
That was one of the findings of a study by Airlines Reporting Corp., a Virginia-based company that handles booking transactions between airlines and travel agencies. The analysis looked at the attitude corporate travel managers have toward “basic economy” fares, the no-frills tickets that come with many restrictions, such as no upgrades, no cancellations and no early boarding.
ARC surveyed 168 travel managers for large corporations and found that 63% have policies that never allow their employees to book basic economy fares. The same study found that 79% of travel booking programs used by corporate travel managers hide basic economy seats as an option, according to Chuck Thackston, ARC’s managing director of data science and research.
ARC did not identify the companies it surveyed but said that 65% of the firms spend at least $5 million a year on air travel, with 26% spending more than $20 million annually on air travel.
Over the last few years, Delta, United and American Airlines have all begun to offer basic economy fares to compete against low-cost airlines such as Spirit and Frontier, which had been drawing business away from the larger, mainstream carriers.
“A lot of business travel managers, when these fares came out, just said no,” Thackston said.
Gabe Rizzi, president of Travel Leaders Corporate, a Miami-based travel management company, said travelers who book basic economy fares often can’t sit next to colleagues, aren’t eligible for upgrades and are seated last and sometimes can’t get room in the overhead bin. Plus, he said, if business travelers miss a flight, they can’t get a refund for a basic economy ticket.
The overall experience may make business travelers so miserable they are unwilling to travel in the future, Rizzi said.
“In the end, a company will most likely end up spending more and the employees are less likely to want to travel to your assignment,” he said.