The Business of Travel

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The Official Blog of the Global Business Travel Association


Week in Review

The business travel industry is at the forefront of today’s global economy. There is always something going on and it can be hard to keep up on it all! This new weekly post is meant to give you a quick overview of the week’s top business travel news stories.

The week started with lots of buzz from SAP’s acquisition of Concur last Thursday. In ComputerWorldUK, SAP CEO Bill McDermott tells why Concur is worth $8.3 billion and calls Concur the best business case he’s ever put in front of the Board.

Concur Chairman and CEO Steve Singh onstage at GBTA Convention 2014 in Los Angeles

Concur Chairman and CEO Steve Singh onstage at GBTA Convention 2014 in Los Angeles

The fight on cell phone voice calls on planes is fully underway. In USA Today, Bart Jansen writes about a group of 77 House Members who wrote Monday to the Federal Communications Commission and the Transportation Department urging against lifting the ban on cellphone calls aboard planes. GBTA’s Shane Downey, director of public policy, spoke with Ellis Booker in this Information Week article about why cell phone calls on planes will be more than just annoying, they could potentially be a tool for terrorists to exploit.

Airplane

A GBTA Foundation study on travel mishaps created a stir in the news with CBS Money Watch writing about how travel snafus hit the bottom line and Charisse Jones of USA Today highlighting how travel problems cost businesses time and money.

In Canada, the inaugural Travel Procurement Symposium was a hit, according to Michael Power. The nearly 120 attendees were given the opportunity to learn about the growing synergy between meetings and events, travel management and procurement.

Bloomberg Businessweek asks the question: Would regulation make airlines’ mileage programs less maddening?

USA Today reported on the Nashville airport becoming the first in the U.S. to give Uber and Lyft the green light to pick passengers up curbside in designated areas. On the opposite end of the spectrum, SFGate reports the San Francisco and Los Angeles district attorneys have sent letters to ride-share companies Uber, Lyft and Sidecar claiming they are operating illegally and warning them that legal action could follow if they don’t make major changes.

Photo Credit: Alfredo Mendez

Photo Credit: Alfredo Mendez

GBTA and Project ICARUS issued a call for applications for the annual Project ICARUS Outstanding Achievement Awards for Sustainability in business travel and meetings across Europe.

PATA Conversations interviewed GBTA’s VP of Operations for the APAC region, Welf Ebeling for his perspective on business travel in China, and what steps are needed to hold its position as a business travel powerhouse.

Finally, earlier this afternoon the Transportation Security Administration (TSA) announced a TSA Pre✓™ initiative that will enhance the program’s ability to identify low-risk, trusted travelers and provide alternative ways for air travelers to apply for expedited screening.


Cap Needs to Be Reinstated on TSA Fees

Earlier this year, the Murray-Ryan budget deal boosted the Transportation Security Administration (TSA)  security fee to a maximum of $5.60 one-way, but the TSA interpreted that to mean that the $10 limit that had previously been in place was eliminated. The bill’s authors — the chair and ranking member of the Homeland Security Committee and its transportation panel — said that was never their intent. The lack of a cap on this fee could result in charges of $20 or more for complex routes.

Rep. Richard Hudson (R-NC), the chair of the House Homeland Security Transportation Subcommittee, introduced a bill reinstating the cap on passenger security taxes. House Homeland Security Committee Chair Mike McCaul (R-TX), full committee ranking member Bennie Thompson (D-MS) and subcommittee ranking member Cedric Richmond (D-LA) co-sponsored the bill, making it a bipartisan effort during extremely partisan times.

Yesterday, the House passed the bill to block the TSA from lifting the cap on the security fee. The measure was approved 423-0 after being debated on the floor the previous night. It was considered under suspension of the rules, a procedure for largely noncontroversial legislation that requires a two-thirds vote for passage.

This is great news! In June the attendees of GBTA's Legislative Symposium stormed Capitol Hill to raise the concern that TSA was going to remove the cap on the Transportation Security Fee. TSA had just announced their plan and the attendees hit the meetings with their Representatives and stated GBTA’s concerns with allowing this to happen. It is clear that your voice makes a difference!

GBTA now asks that the Senate take quick action to cap this fee as continued tax and fee increases are not the answer. More efficient, less costly, risk-based screening programs and tighter fiscal controls are the answer.

Road warriors strengthen the economy, create jobs and drive economic security. Travel should be promoted. GBTA is very concerned taxes and fees are approaching the tipping point that will ultimately push business travelers to stay at home.


Outside Pressures and Struggling Domestic Economy Means Slower Business Travel Growth in Brazil

In a report released earlier this week, the GBTA Foundation is forecasting slower growth for Brazil’s business travel spend. Brazil’s struggling domestic economy and the troubled regional economy are key factors in GBTA Foundation’s significant downgrade to business travel spend growth for the country.

GBTA expects 3.6 percent growth in 2014 and 4.1 percent in 2015, down from our earlier projections of 12.5 percent and 5.9 percent. Total business travel spending in 2013 has also been revised to $30.8 billion from our estimate of $31.2 billion as business travel spending fell in the latter part of the year as the Brazilian economy weakened.

Brazil2014H2pic

The country’s primarily consumption-driven economy is running out of steam to continue propelling growth as outside economic pressures and the domestic slowdown are forcing a slowdown in business travel growth. Uncertainty around the upcoming elections is another factor reducing growth in business travel locally. The previously expected growth in 2014 will be pushed further into the future and we now expect higher rates of growth to resume by the end of 2015. Even in light of this slowing growth, Brazil’s business travel industry surpassed South Korea to become the 7th largest market in the world.

There is a lot of speculation about whether or not the World Cup provided a boost. In terms of business travel and the overall economy, it’s just too soon to tell. While it brought more than a million visitors to Brazil boosting hotel, restaurant, retail, transportation and entertainment sectors; it also brought declared municipal holidays, worker absenteeism and a virtual standstill in many manufacturing and mining sectors.

Brazil desperately needs more help from exports if growth is to break out of the current doldrums. Stronger growth in China, Europe, Argentina and the United State – its key trading partners – is required with Argentina and Europe being the main sources of Brazil’s export struggles.

Despite infrastructure improvements leading up to the World Cup, the World Economic Forum ranked Brazil 114 out of 148 countries for quality of infrastructure, falling seven spots from last year. Brazil’s ability to improve this infrastructure will have enormous implications on business travel over the next 10 years in this market.


Hope for Haiti

*This post originally appeared as an editorial in the Global Business Travel Magazine’s July/August 2014 issue. *

Convention is a place to learn, to build your business, or to be inspired by an amazing array of speakers. But for me, Convention will always be something more.

On January 12, 2010, a devastating earthquake measuring 7.0 on the Richter scale struck the small island country of Haiti. The earthquake hit some of the country’s most populated areas, affecting more than 3 million people and leaving more than 1.5 million homeless. The initial earthquake, coupled with more than 50 severe aftershocks, killed as many as 160,000 people and orphaned over 750,000 children.

The earthquake exacerbated Haiti’s existing problems. The poorest country in the western hemisphere, Haiti suffers from widespread unemployment. The median household makes only $350 per year. The country does not have free public education. It has very few social services and regularly suffers from poor public health conditions; many of the post-earthquake deaths were attributable to an outbreak of cholera. Haiti also has suffered from poor political leadership, with its residents subjected to years of dictatorships and widespread corruption.

After Haiti’s earthquake, we were discussing potential keynote speakers with Vic Pynn from Amadeus. Amadeus had committed to be our Wednesday lunch sponsor for the 2011 Convention in Denver. During those discussions, I learned that several Amadeus employees came together on their own to see how they could help the Haitian people. They initially raised over $100,000 in personal donations and began working with the Great Commission Alliance (www.gcanet.org), an organization that had plans to build an orphanage in the country.

Photo Credit: Meghan McCormick

Photo Credit: Meghan McCormick

Shortly thereafter, Academy award-winning actor and director Sean Penn was on the cover of the New York Times Magazine, profiling how he had become an influential voice on the rebuilding of Haiti. Days after the earthquake, Penn founded the J/P Haitian Relief Organization, which focuses on debris removal, medical aid, security, and the relocation of homeless individuals and families. He was an ideal choice for our Wednesday speaker. His personal dedication was truly inspiring.

I was intrigued by what many throughout the travel community were doing to help in Haiti. So as Convention drew near, I felt compelled to go and better understand the aftermath first hand. Along with some of my GBTA colleagues, we traveled to Haiti. Nothing could have prepared us for the extreme devastation and severe poverty that we saw.

My wife and I became personally involved with the orphanage after that trip. GCA’s story is a quiet and heroic one, led by their executive director, Brian Kelso, and a tireless and highly dedicated staff. They work in an extremely difficult environment, one characterized by compromised security, corruption, complex legal issues, and even kidnapping. The civil society that we take for granted in the developed world simply does not exist in Haiti. Yet GCA is a beacon of hope, continuing to push forward with their dreams and goals of a better world for the Haitian people.

Photo Credit: Meghan McCormick

Photo Credit: Meghan McCormick

For the past several years, GCA has been focusing its efforts in Mirabalais, a town 40 miles outside of Port au Prince, Haiti’s capital. It is working to build a community where more than 100 orphans can live and go to school in safety. In addition to the orphanage, GCA has finished construction of four classrooms on the second floor of a new school, hired school staff, and registered 280 students. They pushed forward to develop a much needed medical clinic and a church/community center on the property as well, thereby helping to build the human and social capital of the broader community.

Photo Credit: Meghan McCormick

Photo Credit: Meghan McCormick

The GCA story of hope became tragically derailed in this past year, when corrupt Haitian locals took over the GCA campus by force leaving the future of the orphans and students in doubt. Fortunately, under Brian’s brave and persistent leadership, GCA has been now able to regain legal and physical control of the campus. Now the difficult task of rebuilding begins.

Convention is personal to me for many reasons, as I have formed many lasting relationships there over the years. But the 2011 Convention, in particular, always will hold a special place in my heart because of my introduction to the children of Haiti.

Photo Credit: Meghan McCormick

Photo Credit: Meghan McCormick