Business class
same. A study of UK executives, carried out by the Economist Intelligence Unit for American Express, revealed 93 per cent believed that corporate travel in search of business was critical to their survival, while 89 per cent thought it boosted sales. Commenting on the findings in terms of
I
corporate travel in business class, Sebastian Marchon, director, advisory services, American Express Global Business Travel, says: “During the financial downturn, some of our customers adapted their policies to restrict travellers from booking premium air travel. However, policy changes restricting premium travel in the past two years have been less commonplace. “While return on investment for business
class is not always easy to measure, we hear from our customers that it allows for a more effective workforce, as their travellers turn up to meetings refreshed and focused on the task in hand,” he explains. That at any rate is the premise on which
the airlines base their business products, and despite the curve balls thrown their way in recent years, they continue to enhance them, working on the Keynesian principle that investment is more effective than cut backs in troubled times. In this they are justified, according to Paul
Wait, chief executive of the Guild of Travel Management Companies (GTMC). “Members tell me that business class
travel is still thriving for some clients,” he says. “But travel policies vary significantly by customer and not just by industry segment. When determining policy and class of travel, companies have to look at how many trips are required to achieve revenue targets, at the annual budget, and how creative their TMC can be in achieving their objectives.” The airlines are also becoming cannier in
how they handle demand. “There is a real flexibility to the seat classes that airlines can play with in order to maximise their yield,” claims Gary Hance, the ATPi Group’s director of IT and yield. “These days,” he adds, “it pays for the
agent to review availability on a regular basis, as carriers change inventory numbers. They have begun to move some of their business class seats into a lower category simply to sell a ticket and gain a fare. These seats are still physically business class seats, but the airlines don’t make as much money
n the mid-20th century, the government’s rallying cry to British companies was “export or die”. Some 60 years on, the message is much the
on them or maximise their yield potential.” Nigel Turner, Carlson Wagonlit Travel's
director of programme management and business development, UK & Ireland, says, “Companies are also handling costs effectively, encouraging travellers to obtain the fairest deals through booking the best value carriers in advance and using more restricted fares.” Another new trend is for travellers to
fly premium economy on daytime flights and return business class overnight as a fare-saving initiative. Anthony Rissbrook, managing director of Hillgate Travel, says the take up has not been significant, and agrees with Nigel Turner’s guiding principles for obtaining the best fares. These will need to be applied rigorously
if business travellers are to benefit from worthwhile deals in a widely differing marketplace. In its Global Forecast 2013, Carlson Wagonlit gives an insight into trends in ticket pricing by region. In Europe, the Middle East and Africa,
says the report, air fares will increase only slightly this year due to carriers’ tight capacity control delivering high load factors. Similarly, fare rises should not be an issue in Asia-Pacific, where CWT finds an increasing number of low-cost airlines are putting pricing pressure on legacy carriers. In North America, ticket prices for US and Canada-based airlines are forecast to experience measured growth as they stay disciplined about controlling capacity to ensure demand outpaces supply. While sleight of hand in terms of yield management might be a key weapon in the airlines’ struggle to remain competitive, there is no illusion in their continuing efforts to attract and retain business through product improvement. In this, they run the rule over demand
and have prioritised everything from swish airport lounges and seats that become beds at the touch of a button, to on-board facilities such as haute cuisine and wifi. For some carriers, the solution has been
to revamp business class and include all the goodies in one move. American Airlines, for example, has
unveiled a new cabin featuring lie-flat seats and a privacy divider (see review on page 105). It has taken delivery of its first three Boeing 777-300ER aircraft – the first US carrier to order and receive them – and is currently flying from Heathrow to New York JFK and Dallas/Fort Worth. Fellow US carrier United is also investing heavily in onboard products, spending
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