Business Travel Outlook 2024

The factors impacting business travel in 2024

2023 was a successful year for business travel in many respects. Travel rebounded at a much faster rate than expected just a year ago, with growth across the industry firmly back on track. Key areas for stabilisation include the return of in-person meetings and events and increasing international business travel capacity and volumes (GBTA). Now in 2024, business travel spending is expected to surpass its pre-pandemic level and will continue to accelerate by 2027, driven by recovery from the pandemic and more positive economic conditions in the past year.

Whilst there were many positive advances for the travel industry in 2023, there were still some barriers to recovery. Rising travel costs were a major area of concern along with staff shortages, operational issues, and the war in Ukraine. The speed and level of recovery has continued to vary by region and industry, with China expected to be back as the top business travel market following the reopening of the economy last year (GBTA).

What factors will impact business travel in 2024?

1) Sustainability

As with previous years, sustainability remains at the forefront of the travel industry’s concerns and this is only set to become more important with government net zero targets on the horizon for 2050. As for 2024, reducing travel-related carbon emissions will continue to be a priority for both travellers and suppliers. According to BTN Europe, ‘multimodal trips now account for almost a third of business journeys in Europe, with rail set to become a more prominent feature in corporate programmes moving forward. However, delays in EU regulation regarding emissions standardisation and multi-modal ticketing may hinder progress’.

2) Travel Cost

As the cost-of-living crisis continues into 2024, price will remain an area of concern for the majority of business travellers. ‘Whilst business travel volumes are expected to continue growing in 2024, air fares, hotel rates and car rental costs are all expected to rise in the year ahead but, thankfully, at a more moderate rate’ than in 2023. ‘Average air fares, hotel rates, and car rental costs are all expected to increase by between 1.8 per cent and 3.6 per cent’ (BTN Europe). The knock-on effects from Covid-19 will continue to impact business travel in 2024, but the fallout is beginning to dwindle. Growth is on the horizon, with BTN Europe reporting that business travel budgets are set to increase.

3) Working Models

The post-covid labour market has seen a true change in the typical working models. With flexible, hybrid and remote working firmly in place in 2024, business travel growth will continue to soar as the need to meet face-to-face and in-person becomes more of a priority. ‘Internal meetings are set to drive growth in the global M&E market over the next 12 months. As such, meeting budgets are also increasing, with spend expected to rise by 2.8 per cent in Europe in 2024’ (BTN Europe). The need to adapt travel policies may also become a priority in the next year as companies seek to reflect their new working models. ‘Meeting technologies and remote work tools will continue to evolve, shaping the future of business meetings and events’ (ITIJI).

4) Geopolitical Tensions

As with 2023, geopolitical tensions will continue to have a major impact on the travel industry in 2024. According to BTN Europe, ‘the ongoing war in Ukraine remains a critical concern. Its implications on global stability, diplomatic relations and travel restrictions remain unknown’. The Gaza-Israel conflict has already impacted the travel industry with international flight bookings having decreased since the start of the war and many people cancelling their trips to the Middle East. The ongoing conflicts in Ukraine and Gaza ‘will also affect Europe’s air traffic capacity in the year ahead. Nevertheless, IATA expects 2024 capacity to increase 8.8 per cent versus 2023 and to be 7 per cent greater than in 2019’ (BTN Europe).

5) AI & Technology

The rise of Artificial Intelligence has been unprecedented in the past year and will continue to have a major impact on travel in 2024. ‘No one anticipated the extent of the hype surrounding ChatGPT and generative AI in 2023, or the speed at which generative it could improve efficiencies in the business travel sector’ (BTN Europe). Industry experts have suggested that AI and robotics process automation could enable travel managers ‘to deliver more strategic solutions to their companies’ by freeing up their time spent on mundane routine tasks (BTN Europe). AI is already being piloted in the industry with new chatbot technologies. 2024 could see a widespread adoption of AI with chat technologies to replace human-based services (BTN Europe).