Passenger Travel: Adapting to Meet the Changing Environment
Government and industry travel experts gathered virtually February 23-25, 2021, for the 5th Annual NDTA-DTMO GovTravels Symposium. The theme of this year’s event was “Respond, Adapt, Innovate—the Changing World of Government Travel.” Looking across the passenger travel landscape, keynote speaker Kurt J. Ekert, President and CEO of CWT, examined the impacts of the pandemic on the industry and the government traveler.
“If you turn the clock back to 2019, travel and tourism as an industry globally accounted for an amazing 10 percent of global GDP [Gross Domestic Product] and nearly 15 percent of global employment. In fact, in many less developed markets, travel and tourism often accounts for more than half of the employment sector in total,” stated Ekert.
“With the onset of COVID, we’ve seen about 90 percent of business travel basically stopped around the world, starting in March of last year. And, even today, a year into the pandemic, we still only see global business and government travel transacting at about 15 percent of pre-COVID levels. And this is due obviously to the massive restrictions and quarantines and the health and safety issues that are so prevalent in these times.”
The far-reaching impacts of the pandemic were felt in job losses, lost revenues, and in other measures such as a reduction in the amount of airline seats being offered. In comparison to the impact of two other modern-day crises—the 9/11 attacks and the 2008-2009 financial crisis—on the travel industry, the impact of COVID in 2020 was 10 times the impact in terms of volume of those two events combined.
Despite these daunting statistics, Ekert said some positive signs are emerging. The global roll-out of vaccines is important for creating a platform for the successful return to travel. The roll-out will be enhanced by a return to workplaces. Digital health passports are starting to become a norm. While standardizing the use of these and addressing the challenges of balancing their use with privacy laws will take time, their adoption will only further encourage a return to travel normalcy.
“Over the next two to three years we are likely to see a very strong leisure travel recovery, albeit probably less so on long-haul destinations. That’s going to take longer. And, business travel recovery and meetings and events recovery will occur. Our expectation is that recovery will not start in earnest until the fall of this year with more widespread vaccination,” Ekert predicted. “We believe that we’re not going to see 2019 volume levels in the business travel sector for at least five or six years. We think there are permanent structural changes that have occurred because of COVID.”
A major change in the eyes of a corporate or government travel manager is a focus on traveler health and safety in determining an “allowable trip.” Criteria, such as airlines that keep middle seats unoccupied or hygiene measures taken by hotels or local infection rates, may factor into decision making. For the traveler, there has been a shift at the intersection of technology and human interaction. Travelers now expect consumer grade tools to complete their transactions.
“Business travel is going to return with the end of the pandemic, but behaviors will change, passengers are going to adapt, we’re going to emerge into a new reality, and the shape and the size of this industry are going to be different certainly than what they were [in] 2019 and before,” said Ekert. “And, the idea of returning to normal to me, for this industry, is a misnomer. There is no normal, we’re going to emerge into something that is different and we’ll have to adapt.”