Michael W. McCormick
Executive Director and Chief Operating Officer,
Global Business Travel Association (GBTA)
Did anything surprise you about the travel sector’s
performance in 2015?
Business-travel spend continues to go up, but
the weakened global economy and the plunge in
oil prices have caused that growth rate to slow.
International outbound (IOB) travel has been
the most prominent driver of the recovery since
2009, but this year, while volume is increasing by
over 5 percent, spending on IOB travel is being
slashed by more than 50 percent from 2014. While
businesses continue to see business travel as an
investment to grow their business and, in turn, the
economy, uncertainty and risk abroad have led to
more cautious spending.
What sort of performance can we expect from the
travel sector in 2016?
Despite the weakened global economy, we still
expect business travel to grow in 2016 — in the U.S.,
GB TA projects a 3-percent increase in trip volume
and business-travel spending, to exceed $300 bil-
lion for the first time ever. Our 2016 global travel
price outlook reveals airline prices will be nearly
flat with the exception of several global hotspots;
hotel prices will go up as demand overtakes supply
in every major global region; car-rental pricing
will continue to face pressure, remaining stagnant;
and meetings and events will see modest increases
in cost per attendee per day, as well as group sizes.
What is one trend in travel that meeting professionals should be keeping an eye on in 2016 and beyond?
Revised figures in our most recent U.S. business-travel forecast showed that group-travel spending
exceeded spending on individual business travel in
2014 for the first time since we started tracking business-travel activity in 2008. Group-travel spending
was expected to increase 3. 2 percent in 2015, and
will grow another 2. 7 percent next year. Meeting professionals can capitalize on this increased
demand for group travel now, as companies often
plan to attend or hold group meetings far in advance.
Looking further down the road, meeting professionals should keep an eye out for business-travel
markets of the future. In our annual global-busi-ness-travel forecast, GBTA identified five newly
emerging markets often overlooked because they
aren’t as large as the traditional powers or the
BRIC [Brazil, Russia, India, China] markets. Their
rapid growth puts them in a position to become
business-travel markets of the future: Indonesia,
Malaysia, Mexico, Poland, and Turkey.
Bookings and Budgets — 2016
A survey of 154 global travel executives from
100 major organizations reveals that budgets are
shrinking even as global costs rise:
In recent years, rising fuel prices, government duties, and
airport fees have dramatically increased the cost of business travel. As organizations continue to feel the effects of
unstable economic conditions globally, they are looking to
minimize the impact of rising prices and to ensure that travel
budgets deliver the greatest possible value for customers
› 48% of travel budgets are less than $30 million a year.
› 13% of travel budgets are more than $250 million a year.
› 32% of travel executives make fewer than 15,000
corporate travel bookings a year.
› 10% of travel executives make more than 500,000
bookings a year.
SOURCE: Perspectives on Corporate Travel Trends and Challenges,