Table of Contents
Introduction
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- Key findings
- Abbreviations
Data Sources
Overview
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- Economic outlook
- Trade growth correlated to business travel
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- Figure 1: Overview of WEO projections (% change unless noted otherwise), January 2012
- Business travel spending by principal world region
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- Figure 2: Forecast trend in spending* on business travel & tourism by region** and worldwide, 2011-21
- Business travel spending by major country
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- Figure 3: Forecast for spending on business travel & tourism by major country* market, 2011-21
Business Travel Transport
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- Air travel
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- Figure 4: Trend in demand and supply in air transport worldwide, November 2011
- Market breakdown
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- Figure 5: LCCs & unaligned carriers versus alliances: capacity & shares of global aviation, December 2010/11
- Alliances target business travellers
- LAN/TAM an attractive partner
- Star and SkyTeam trying to gain a foothold in India
- IAG to acquire bmi
- Virgin Atlantic seeking an alliance
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- Figure 6: Profiles of the three major airline alliances, 2012
- Co-operation can be difficult
- A problem of inconsistency
- Are regulators too soft on the major transatlantic airlines?
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- Figure 7: Share of available seats on the North Atlantic route, April–October 2011
- DoT requires collusion
- The DoJ takes different view from DoT
- European Commission more strict
- Airlines need more pricing power not less
- Airlines have lowest returns
- SkyPriority for premium customers
- Delta developed and implemented programme
- Star Alliance’s tool for convention travel
- United – the world’s largest airline
- Five out of ten are US airlines
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- Figure 8: World's largest airlines by weekly seats and ASKs, December 2011
- Longer flights drive growth
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- Figure 9: Worldwide capacity, December 2010 versus December 2011
- China Southern targeting Oceania
- Emirates to grow in US
- Etihad Airways
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- Figure 10: Etihad's future 787-9 destinations, 2011*
- Qatar Airways
- Turkish Airlines
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- Figure 11: Selected Europe–Central/Eastern Africa routes, 14 November 2011–20 November 2011
- Low-cost carriers the growth segment
- Largest low-cost carriers
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- Figure 12: Top 25 LCCs worldwide by capacity (ASKs/week), December 2010 versus December 2011
- US LCCs target business travellers
- JetBlue’s special features for the business traveller
- European LCCs go after business travellers too
- Easyjet positioning itself for business segment
- Ryanair has changed tack
- airberlin has already taken steps to woo business travellers
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- Figure 13: Purchase price of topbonus airmiles, 2012
- Rising airfares
- US fares are rebounding
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- Figure 14: Trend in US domestic airfares, 2001-11
- European pollution permit requirement raising airfares in Europe
- Delta judged best in US
- Premium economy added
- Sky Partner Review reports appreciated
- Mergers and financial difficulties held back others
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- Figure 15: Corporate travel buyers rate US airlines on a scale of 1 (poor) to 5 (excellent), 2011
- Perceived quality going down
- Unbundled fees are unpopular
- Worldwide ancillary revenue soars to US$32.5 billion in 2011
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- Figure 16: Amadeus worldwide estimate of ancillary revenue, 2011*
- Budget airlines highly dependent on ancillary revenue
- Major US carriers generate largest share of ancillary revenue
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- Figure 17: Breakdown of ancillary airline revenue by carrier type, 2011
- Figure 18: Breakdown of ancillary airline revenue components in the US, 2011
- Ancillary revenue up 72% in North America
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- Figure 19: Ancillary revenue estimates by world region, 2010-11
- Air-travel passes
- Limitations
- Business travellers moving back to the front of planes
- Key routes still showing growth but momentum slowing
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- Figure 20: Trend in premium air travel on international routes, 2011
- Profile of premium air traveller
- Three categories
- Premium travellers’ criteria for selecting airlines
- Business class weighing down the plane?
- Business-class flatbeds date from 2000
- Business-class seats – a problem for manufacturers
- Airbus 380 delayed two and half years
- Lighter-weight materials
- Boeing’s new 787 Dreamliner finally launched
- Over 800 Dreamliners on order
- The A350 XWB on the way
- What do travellers look for most in a plane?
- Amenities promised on board the new A380
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- Figure 21: What would you most like to see on the new jumbo jets?, 2012
- In-flight Wi-Fi
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- Figure 22: In-flight Wi-Fi availability and cost on US airlines, 2011
- Gogo Wi-Fi service options
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- Figure 23: Cost of Wi-Fi use on single flights, 2011
- Continental to provide Wi-Fi soon
- Limited take-up so far
- Gogo’s business model could be threatened
- Mixed outlook for private aviation
- Inventories contracting
- While flight activity has started to take off
- High end has held up well
- 90% of purchases are for cash
- Top end being driven by emerging market purchases
- Business-jet sales may grow in 2012
- Declining deliveries
- Decline in number of used jets for sale
- Prices still far below 2008 levels
- No gains expected for small and medium-sized business aircraft
- NetJets sees better times ahead
- Shared ownership on the rebound?
- Airlines targeting private-jet market
- VistaJet
- Jet Connections, a new business model for private-jet travel
- Airports and security
- Streamlining security checking procedures
- 500 body scanners in 100 US airports
- Technology alone is not the solution
- Pre-screening the way forward
- Children and military exempted
- Global Entry
- SENTRI
- Privium Club
- Saphire
- NEXUS
- Behavioural profiling – another approach
- Europe ready to allow liquids but not US
- Car rental
- Six major car-rental groups worldwide
- Eight brands owned by four companies in US
- Two major European operators
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- Figure 24: Major car-rental companies, 2010
- Sector making a comeback
- Return to purchasing cars could favour business segment
- US corporate car-rental rates down in H1/2011
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- Figure 25: Average cost per day, January-May, 2010 and 2011
- Airport rentals more dominant in US
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- Figure 26: Car-rental market share at top 50 US airports, 2010
- Avis serves business market while Budget is leisure oriented
- Avis Budget acquires Avis Europe
- Hertz’s new rental kiosks
- eReturn
- Rail travel
- Taking share from air
- Eurostar dominates London–Paris route
- Eurostar targets business travellers with Business-Premier class
- Standard Premier, a less costly alternative
- Journey time cut on Paris–Geneva route
- Thalys International
- ‘Le Salon’ for high-speed meetings
- B2B offerings
- Turnover boosted by revival in business travel
- London–Frankfurt by rail instead?
- Almost half of airline passengers may go by rail
- Shift from air to rail in France
- TGV expansion to west and south-west
- Italy’s Alta Velocità trains
- Full steam ahead for UK
- Critics and disgruntled abutters
- An Aussie bullet train?
- Sydney–Melbourne in three hours
- An open-plan design for the A-HSV
- Beijing–Shanghai in less than five hours
- Paperless boarding for Chinese travellers
- China Eastern to feel the competition
- A trebling of high-speed lines by 2020
- Japan has most developed high-speed network in the world
- Competition with air travel
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- Figure 27: Comparison between rail & air travel between Tokyo and selected Japanese cities, 2011
- The newest Shinkansen
- Rail has taken over in South Korea
- Future development of high-speed rail
- South Africa’s Gautrain
- 15 minutes from airport to Sandton
- An 80-km rail route
- 40 minutes from Johannesburg–Pretoria
Business Travel Accommodation
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- Habits of younger business travellers
- Free Wi-Fi a must for both groups
- Backed up by Hotels.com survey
- And TripAdvisor
- Luxury hotels rethinking Internet fees
- Cash cow for hotels
- Impact on rate negotiations
- Food and beverage also important
- Streamlining the check-in process
- OpenWays in discussions with other chains
- Scanning guests’ ID – another way to check in
- Not all hotels want to completely automate
- Getting rid of business centres
- The business centre is the guestroom
- ‘Tech butlers’ and lobbies
- Holiday Inn’s ‘The Hub’
- Some new hotels skip the business centre altogether
- Mandarin Oriental’s business lounge
- Drawers on the way out
- The hotel-room desk a thing of the past?
Business Travel Management and Distribution
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- Enforcing travel policy
- Lowest logical fares
- Premium tickets mostly not allowed within North America
- Connecting with managed travellers
- Sample detail
- Younger travellers less likely to respect travel policies
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- Figure 28: Transactions complying with company-preferred vendor & booking-channel policies, by age, 2010
- Communication a problem
- Communicating preferred agreements to employees
- Security an important component of travel management
- Email or smartphones?
- Business travellers depend increasingly on mobile-phone apps
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- Figure 29: Mobile-phone apps useful for business travellers, 2011
- Different approaches to managing employee use of mobiles
- Providing travellers with the tools
- Apps for expense control but not itinerary management
- When things go wrong
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- Figure 30: Primary source of employee location & contact information in an emergency, 2011
- Figure 31: Tools & methods used for company-provided emergency assistance programmes, 2011
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- Figure 32: Tools & methods used for company-provided traveller/crisis alerts, 2011
- Figure 33: Tools & methods used for en-route service recovery, 2011
- More mobile apps could reduce use of phone calls
- Unbundled charges complicate expense monitoring
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- Figure 34: En-route/at-destination technologies that travellers use or plan to use*, 2011
- What’s reimbursable?
- Most reimburse baggage fees
- Size matters
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- Figure 35: Expenses covered by organisations, 2011
- Younger travellers more willing to pay for extras
- Travel programmes becoming more globalised
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- Figure 36: Primary basis on which companies were deploying the following managed travel components*, 2001, 2006 & 2011
- Self-booking tools remain an exception
- Factors driving globalisation of travel programmes
- Traveller security
- Compliance
- Cost savings brought on by economic crisis
- Improved supplier offerings
- Implementation strategies
- Barriers to globalisation
- Cultural considerations
- GDS content
- Language
- Payment methods
- Labour costs
- Corporate travel management companies
- Corporate priorities have taken precedence
- Demand management the sole innovation
- Traveller needs neglected
- Leisure-travel market use of technology impacting business travel
- Harnessing new communications channels
- Strategies to optimise travel management
Business Travel-Related Loyalty Programmes
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- WebFlyer audience
- The bigger the better…
- High concentration of members in the big schemes
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- Figure 37: Membership totals of major airline and hotel loyalty programmes, 2011
- FFP redemptions on major US air routes
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- Figure 38: FFP award seats as a % of total offered on the highest capacity US air routes, 2005-09*
- Loyalty benefits preferred over spouses
- Extra trips to rack up points
- Honeymoon? Emergency?
- Among other key findings
- Not necessarily loyal to Starwood, however
- Starwood pulls out all the stops
- Making SPG a top priority for frequent travellers
- 2% of clients generate 30% of profits
- Just catching up with the competition
Meetings, Incentives, Conferences and Exhibitions
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- Leading international meeting venues
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- Figure 39: Worldwide breakdown (market share) for meetings by continent, 2009*
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- Figure 40: Top countries for international meetings in 2009 and 2010
- Figure 41: Top cities for international meetings in 2009 and 2010
- Optimising meetings through planning and control
- American Express’ MEETINGS EXPERT
- Offering assistance for ad-hoc meetings
- Helping to achieve compliance
- AmEx claims cost savings of 28%
- Design is important
- Content is king
- Design as discipline
- High-tech, high touch
- Time for meeting professionals to embrace social media?
- Social media can amplify impact of an event
- Twitter screen behind a panel discussion
- Community portals
- Teleconferencing
- Recession has accelerated use
- Teleconferencing here to stay
- Increased cost of travel and reduced budgets boosting teleconferencing
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- Figure 42: Has there been a change in the volume of virtual meetings/teleconferencing at your company in the past year?, November 2011
- Videoconferencing lifted by US budget cuts
- IRS to cut travel cost by 27%
The Top Five Business Travel Destinations
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- China
- Air travel prevalent but chaotic
- Rail travel taking up the slack
- Distribution tends to be ad hoc
- Few formal agreements with travel suppliers
- TravelSky the only GDS allowed in China
- Online booking progress slow
- Payments still mainly in cash
- A stumbling block
- Japan
- Travel suppliers dominate distribution
- LCCs entering market
- A major transition in 2012
- JAL’s hands-off approach to Jetstar Japan
- AirAsia Japan’s CEO comes from ANA
- Peach and AirAsia to avoid major overlapping
- AirAsia’s planned fleet expansion
- Germany
- SMEs show higher growth in trips
- Costs under control
- Catching up on foreign travel
- Large companies increasing travel to European destinations
- Travel costs declining
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- Figure 43: Trend in business-travel expenditure in Germany, 2006-10
- Figure 44: Breakdown of German business-travel expenditure by category, 2009-10
- Trend towards higher-grade hotels
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- Figure 45: Breakdown of German business-travel hotel overnights by category, 2009-10
- No formal control of hotel costs
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- Figure 46: Breakdown of German business-travel hotel usage by category – domestic and abroad, 2010
- Booking channels
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- Figure 47: Breakdown* of German business-travel booking channels, 2010
- Outlook
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- Figure 48: How will the number of business trips change in your company in 2012 compared to 2011?
- UK
- Accommodation
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- Figure 49: Accommodation used for domestic business travel in the UK, 2010
- Transport
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- Figure 50: Transport used for domestic business travel in the UK, 2010
- Booking channel
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- Figure 51: Booking channels used for domestic business travel in the UK, 2010
- Inbound business travel
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- Figure 52: Trend in inbound business tourism to the UK by type, 2007-10
- US
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- Figure 53: Profile of US business & convention travellers visiting overseas destinations*, 2010
- Flights
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- Figure 54: Airline choice, type of ticket and cabin class for US business & convention travellers visiting overseas destinations*, 2010
Sustainable Development and Corporate Social Responsibility
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- A more environmentally friendly programme
- What sort of measures to take?
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- Figure 55: Which of the following measures will you take to make your programme more environmentally friendly?, 2011
- Electric rental cars
- Hertz Connect
- Hertz & Marriott offer electric-car test drives
- Enterprise Rent-A-Car rents EVs in more than eight US states
- Europcar’s electric Ampera car
What Next?
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- Unmanaged business travel to become the norm?
- A defined budget rather than preferred suppliers
- Social-media comments becoming an issue
- Changing dynamics of corporate airline agreements
- Limited availability of low-priced tickets
- Outlook for travel-related prices
- Capacity cuts to support airfare increases in 2012
- Business-class fares expected to rise in 2012
- Forecasts for Asia Pacific
- Airfares
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- Figure 56: Forecasted increase in APAC airfares, 2012
- Hotels
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- Figure 57: Forecasted increase in hotel rates in the APAC region, 2012
- Forecasts for Latin America
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- Figure 58: Forecasted increase in LATAM airfares, 2012
- Figure 59: Forecasted increase in hotel rates in the LATAM region, 2012
- Forecasts for the Middle East and Africa
- Airfares
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- Figure 60: Forecasted increase in EMEA airfares, 2012
- Hotels
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- Figure 61: Forecasted increase in hotel rates in the EMEA region, 2012
- Forecasts for North America
- Airfares
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- Figure 62: Forecasted increase in North American airfares, 2012
- Hotels
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- Figure 63: Forecasted increase in North American hotel rates, 2012
- Car rental
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- Figure 64: Forecasted trend in North American car-rental rates in 2012
Index to Travel & Tourism Analyst
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- Index grouped by geographic area
Index to TTI Destination Reports
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- Country reports
Special Reports Index
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