September 24, 2008
Reuters reported yesterday that airlines are going to be cutting corporate discounts or pulling contracts if businesses fail to meet their air travel commitments.
Preferred rates are negotiated with the expectation of a certain level of sales delivered. Aggressively pulling back on the discounts or contracts is new, but reflects the imperatives of today’s economic environment.
For businesses, this will create a challenge. Cutting back travel will save money on travel expenses yet compromise preferred contracts. Robbing Peter to pay Paul, so to speak. Corporate travel will increasingly be viewed with more scrutiny, heightening the importance of reporting tools.
At Jupiter, we are spending a lot of time talking about the impact of the economy on travel. This impact will be discussed in our upcoming US Travel Forecast. We�re also fielding the Frequent Business Traveler Survey in the next couple of weeks with the report scheduled for November. I suspect we’ll see an increase in compliance policies, both for booking with the selected provider and preferred airline.