© Reuters. FILE PHOTO: A passenger plane takes off from London Luton airport, Luton, Britain, January 7, 2018. REUTERS/Peter Cziborra/File Photo
By Allison Lampert and Doyinsola Oladipo
(Reuters) – Flight bookings for international business travel this fall are nearing 2019 levels, in a sign of recovery, according to a travel data firm, but climate concerns and economic clouds could mute demand for work-related trips.
Business travel has generally lagged leisure trips in airlines’ recovery from COVID-19. United Airlines (O:) CEO Scott Kirby (NYSE:) said this week that the U.S. is in a “business recession,” and a rebound in company travel would take more time.
But business bookings for September to November trail 2019 levels by less than 10%, the best showing since that year, according to data from travel analytics firm ForwardKeys set to be published on Wednesday.
A broader recovery in all air travel and the end of pandemic-related restrictions have made it easier to plan business trips, Olivier Ponti, ForwardKeys’ vice president insights, said. The data is based on reservations for major global airlines in comparison with the same period in 2019.
While the Global Business Travel Association (GBTA) expects a full sector recovery in mid-2026, signs of growing demand are being seen by segments like hotels this year.
MGM Resorts (NYSE:) International CEO Bill Hornbuckle expects record future bookings from now until November.
The “convention crowd is stronger than it’s ever been when you look at future holdings,” Hornbuckle told the NYU International Hospitality Industry Investment Conference on Tuesday.
Both airlines and hotels are seeing more travel by small and medium enterprises (SMEs), compared with large corporations.
About 85% to 90% of Hilton’s corporate bookings are from SMEs, up from 80% pre-pandemic, Christopher Nassetta, CEO of Hilton Worldwide Holdings (NYSE:), told the NYU conference on Monday.
But climate concerns are expected to weigh on corporate travel gains, with four in 10 European and a third of U.S. companies saying they need to reduce trips per employee by more than 20% to meet 2030 sustainability targets, said consultancy Deloitte.
More than a third of companies surveyed by the GBTA Foundation are either purchasing or expect to buy less- polluting alternative fuel or carbon credits by 2025 to offset employees’ trips, according to research being released on June 13.
Carbon credits that support environmental projects have faced criticism because they offset but do not reduce actual airline emissions. Even so, some environmental groups support their use as long as they back effective projects.
“I think we cannot discard any of the options,” said Delphine Millot, a sustainability executive at GBTA.
(Reporting bBy Allison Lampert in Montreal and Doyinsola Oladipo in New York; Editing by Leslie Adler)