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September 2022, Virtual
September 29 2022, Virtual
Travel buyers are continuing to shift air bookings from business to economy class in a bid to help bolster the company’s bottom line, an HRG study has found.
HRG said it’s “indisputable” that there has been an overall move from business to economy class and a shift towards more lower cost and less flexible fares, as companies look at ways to reduce their corporate spend.
The latest HRG air data shows that the economic uncertainty of recent years has driven corporates to continue to refocus on their bottom line and to acknowledge that cost-effective corporate travel is a “contributory factor to a healthy cost base”.
The data shows that in 2013 UK business travellers increasingly booked economy fare trips, with a 35 percent switch from business class, year on year. For those businesses continuing to make business class bookings, HRG has also seen some changes, with an 8% move towards more restrictive tickets, in a bid to keep costs down.
“While policy changes are still broadly driven by hours flown and destination, it is indisputable that there has been an overall move from business to economy class, and within both classes, a shift towards lower cost, less flexible fares, as companies look for actionable ways to reduce their corporate spend,” said Matthew Pancaldi, global client management director at HRG.
He added that as the economy improves clients still remain focused on reducing their travel expenditure as they seek to manage costs and contribute to organisational profitability.
“For domestic and regional travel, encouraging the appropriate use of advance purchase and restricted fares will continue,” said Pancaldi.
“On longer-haul journeys our advice is to shop for the lowest fare of the day but also to secure competitive agreements with preferred suppliers on key routes.
“This will help to maintain low fares when increasing demand impacts availability and inevitably puts pressure on price. If a client is able to follow this advice they can ensure that fares are capped on routes where they have the most volume. This will help to mitigate the risk of fare increases, particularly in markets where demand is beginning to surge.”