The Future of Business Travel

Last week, several Northeastern chapters of the National Association of Corporate Directors presented a disturbing webinar concerning the future of business travel and conventions. The composition of the panel is important to note as panelists were not mere talking heads but senior executives in their respective organizations, each with access to deep data: heads of the relevant New York and Massachusetts state agencies, Amtrak and the second largest business convention travel organizer in the world.

The key take-away: large gatherings of all sorts are kaput for at least 3-5 years and indeed to some degree quite possibly permanently. Gathering will not involve a thousand people, or large industry gatherings at indoor venues; business meetings will involve at most 50-100 people.

I note: this is a future prediction, always prone to material error; this is a prediction based on wide data but all gathered in the depths of the pandemic and thus perhaps biased to the bleakest conclusions; it is not clear how the benefits of gatherings of a thousand people, or the vast benefits of industry conventions with exhibits and programs and networking and keynotes, can be achieved by remote means.

But to the extent the takeaway is accurate, the new normal will not track old normal, which is disquieting.

Other interesting points: current softness in travel has allowed huge speed-ups in maintenance and repair of infrastructure; infrastructure in the USA remains deficient and will demand huge investment over the next decade and more to safely support even a reduced travel expectation; many CEOs will build in economic efficiencies in electronics and business travel will be permanently and materially reduced; although office use, and thus office space, will decline, certain human factors will drive the need for some continued office usage (human sociability; need for direct collaboration to process innovation; inability to onboard and integrate new talent without direct contact). Also noted: the possible use of government funding to solve the dual goals of societal solvency through work and infrastructure rehabilitation.

Finally, I cannot resist some fascinating factoids: Amtrak lacks studies of airflows in trains, although there is much work for airplane airflows; rail travel during the pandemic was 10% business-related, down from 40%; rail travel for the current fiscal year is projected at 16% and in fiscal ’22 at 27%: New York road use dropped at 50% during the pandemic, and today is at 85%; polled attendees at the webinar were ready to travel in the following percentages: today 7%, in 3 months 32%, in six months 46%; of polled attendees, over half saw travel returning only to 50% or less; Logan airport sees aviation recovery taking 3-5 years; the CEO of the travel booking agency sees rebound in 5-6 years; Amtrak saw a 90% total overall ridership drop, now ridership is 22%, and in fourth fiscal quarter (ending next September 30) they project mid-30% range of usage; Amtrak still running almost 50% of the number of trains per day notwithstanding less usage, in order to stay viable.

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