American Express Global Business Travel expects the travel recovery to continue to “build strong momentum” during 2022 as transactions have risen to just over 60 per cent of pre-Covid levels.
The travel management company said that the volume of bookings had reached 61 per cent of 2019 levels for the week ending on 2 April. This was a 33-percentage point improvement from the middle of January when bookings dipped due to the spread of the Omicron variant.
Amex GBT’s total transaction value (TTV) also recovered to 59 per cent of pre-Covid levels by the start of April.
Paul Abbott, Amex GBT CEO, said there had been an “encouraging trend” in recent weeks, during the company’s investor day in New York on Tuesday (12 April).
“The travel recovery is building strong momentum,” he said. “Transactions have increased by 200 per cent since mid-January.”
Chief commercial officer Drew Crawley added that there had been “steep growth” in bookings with clients not “battening down the hatches” in the wake of the spread of Omicron.
“We do believe that businesses and employees want to travel,” said Crawley. “The main barrier to business travel is closed borders or restrictions that are too stringent.”
Crawley also expected internal meetings to grow in importance due to more hybrid working after the pandemic. While the TMC should also benefit from larger clients reopening more offices in the second quarter of 2022 and easing their Covid travel restrictions.
During his presentation, Abbott highlighted the potential of the SME market, particularly the estimated $675 billion worth of travel bookings made by “unmanaged” SMEs who currently book with online travel agencies or directly with airlines rather than TMCs.
“There’s a tremendous growth opportunity that we have in the SME segment,” he emphasised. “We can bring savings, service and financial control through a professional managed programme. We have exactly the right solutions to make this happen.”
Abbott stressed that business travel was a “complex and resilient sector” which historically had grown at or above GDP levels, with an average annual growth rate of 4.4 per cent from 2000 to 2019.
He said the current “consensus” view of the sector’s recovery was for a 90 to 100 per cent return to 2019 sales by the end of 2023.
But he added that Amex GBT only needed to see the industry recover by 70 per cent by the end of next year to return to pre-Covid earnings.
The investor day was held by American Express GBT ahead of its planned listing on the New York Stock Exchange later this year.