October 31, 2022 | Market Intelligence
More than two years after the pandemic first hit, there has been little respite for the corporate travel industry.
In fact, with many organizations adopting a hybrid work model and employees working remotely, there isn’t much need for corporates to travel and meet in person.
Instead, they are now meeting on virtual platforms and collaborating with the help of digital tools.
All this has eliminated the need to travel and defined a new normal for corporate travel.
As leading players anticipate a drop in travel demand, they look to deploy new strategies to remain competitive.
With the industry sustaining heavy losses since the outbreak of COVID-19, several leading airlines companies, travel agencies and hotel chains are looking at consolidation as a means to sustain and navigate the pandemic- induced financial slowdown.
The last two years have seen a spate of mergers and acquisitions happening in the corporate travel space.
Some of the notable ones are: -
By acquiring companies in other countries, brands can expand their reach and increase their range of offerings. For instance, Hyatt’s acquisition of Apple Leisure Group has enabled the former to double its global resorts footprint.
The outbreak of the COVID-19 pandemic had a huge impact on industries around the world. Corporate travel was among the worst hit, with the International Air Transport Association (IATA) projecting net losses of $47.7 billion for 2021. International travel witnessed a 75% drop in the total number of trips, while domestic business tourism observed a 56% drop.
Increasing adoption of communication technologies such as Zoom, Microsoft Teams and Citrix ensured that companies could effectively maintain employee engagement, collaboration and partnerships during this period. However, this also led companies to question and rethink their corporate travel budgets.
With companies halting operations from office and encouraging their employees to work remotely, business travel reduced drastically during this period.
Leading companies in this space are now considering mergers and acquisitions as a measure to sail through, consolidate competition, drive revenue and develop operational efficiency.
The corporate travel industry is showing gradual signs of revival post lifting of the COVID-19-related restrictions.
However, it would at least take a couple of years before the industry can bounce back to pre-pandemic levels.
In the current scenario, mergers and acquisitions can help brands stay competitive in the constantly evolving corporate travel space.