Finally, the recovery we’ve all been waiting for!

The first quarter of 2022 signalled the long-awaited restart for the global travel industry. With industry dynamics such as border rules, COVID-19 restrictions, travel demand, airline seat recovery and hotel occupancy all heading in the right direction – industry insiders predict 2022 is the year corporate travel bounces back to pre-COVID levels.

According to the latest industry data in FCM Consulting’s Global Trends Report for Q1 2022, signs of the corporate travel recovery are evident across the globe. While each regional market is rebounding at a different pace, the pendulum of supply and demand is gaining momentum. The Americas is leading the charge, with airline seat recovery for the region’s top three corporate carriers, indicative of the region’s imminent rebound to pre-COVID levels.  

The global corporate sector’s increasing appetite for international travel is also helping to fuel the travel industry bounce-back, despite a backdrop of rising fuel prices, growing inflation and geopolitical unrest in Ukraine. Travel supply chain disruption and increasing costs are also adding pressure for airline, hotel and car rental operators who are under the pump from increased demand.

Additionally, it’s predicted that the northern hemisphere summer will see a surge of people travelling again as restrictions are totally removed. This will make it easier for corporates to travel again. Expect flights during this period to be jam packed!

The upshot for corporate travel programs?

• Rising accommodation rates across most regions and international airfares on some key corporate routes means business may be focusing on cost containment in the back-half of 2022.
• Efforts to integrate sustainability into travel programs will continue to be a focus with travel policy and education, demand management and CO2 offsetting remaining front and centre.
• TMC innovation has also taken a new turn during the pandemic. COVID-19 has placed more emphasis on omnichannel technology to facilitate more efficient processes for trip approvals, push alerts and communication to better support travellers throughout their journeys.

Innovation is starting to play out in a different way,” FCM Consulting General Manager, Felicity Burke said. “TMCs are bringing greater efficiencies to the travel experience, so we’re seeing that once employees resume travelling again, they need to have mobile phone global roaming on, they need to have push alerts enabled and travel communication for country border and health alerts easily accessible. These are all additional aspects to the travel experience that weren’t necessarily a hot focus for all companies pre-COVID.

FCM Consulting Global Snapshot

Americas (including North America and Latin America) 

Americas is at the forefront of the travel industry’s recovery. The region’s approach to COVID-19 rules, regulations and cross border travel has opened up the region quickly. This means the Americas will be one of the first regions to return to pre-COVID and (beyond 2019 levels) before other regions. The region’s three major carriers including Delta, United Airlines and American Airlines are well and truly back on track for seat recovery. Accommodation is also taking off with average room rates rising in numerous locations.

Stabilisation in Latin America’s accommodation sector is evident as hotel occupancy nears pre-COVID levels.

Asia

Southeast Asia and China have the lowest hotel occupancy levels. With China’s borders remaining closed and COVID-19 rules and regulations for many Asian countries still in place, not all hotels have reopened to full capacity. The region’s carriers including Cathay Pacific and Thai Airways are significantly behind other corporate carriers in terms of seat recovery rates. Despite this, Singapore is leading the way for Asia, followed by India with both countries rebounding comfortably.

Australia and New Zealand

Domestic airfares in Australia in Q1-2022 were extremely competitive with airlines trying to stimulate activity. Compared to Q4-2021 Australian hotel rates across the major city centres are on the rise. New Zealand is only a couple of months behind Australia in terms of opening up, traveller confidence and travel activity. It’s expected New Zealand will return to ‘normal’ by Q2-2022.

Europe

Airfares are on the upward tick across Europe with carriers tightly managing supply and passenger yields. Corporate travel is returning across Europe despite the shadow of geopolitical tension. Travel activity improved following the early relaxation of COVID-19 regulations. While London and Dublin experienced hotel room rate increases in Q1-2022, it’s expected other parts of Europe will follow once summer arrives.

Middle East and Africa

A rush of travel across Africa in Q1-2022 fuelled hotel occupancy and rate increases in the region. It’s expected South African Airways will bounce back later in the year following some major changes to the carrier’s business model.