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Thai-based hospitality group Minor Hotels has purchased an additional stock in NH Hotels, increasing its holding to 94%, Business Traveller reports. The purchase will enable Minor Hotels to expand in Europe, while also allowing NH Hotels to put down roots in Asia.
Icelandair has signed an agreement to buy budget airline WOW Air for nearly $18 million USD (approximately €15.9 million), Buying Business Travel notes.
According to France24, Airbnb is being sued by French hoteliers for unfair competition. The main trade group for French hotels, The Union of Trades and Industries of the Hotel Industry (UMIH) accuses the home-sharing company of “knowingly violating” certain imposed rules.
What will the election mean for business travel? Regardless of who wins or loses, a change in committee leadership means a change in governing philosophies, ultimately affecting our industry. Here are the main travel-related committees to keep an eye on.
Birmingham Airport has unveiled a £500m master plan to increase capacity and improve the traveler experience, Buying Business Travel notes. The investment aligns with the airport’s desire to grow traffic by 40% (to 18 million passengers annually) by 2033.
Over the next 20 years, China will account for approximately 19% of the world’s aircraft demand, Business Traveller reports. According to Airbus’ Global Market Forecast, the country is projected to require nearly 7,400 new passenger and freighter aircraft.
Star Alliance is putting virtual reality technology to the test in select lounges, Business Traveller writes. Travelers flying through CDG in Paris and FCO in Rome can try out the virtual reality systems, which may eventually be offered on planes and across lounges globally.
The TSA will begin testing new technology that can screen multiple passengers from up to 25 feet away, Los Angeles Times reports. If the terahertz screening devices pass the initial tests at a TSA facility, they may be further tested at U.S. airports.
According to IATA’s latest 20-Year Air Passenger Forecast, air traffic could double to 8.2 billion travelers in 2037. The forecast also outlines China, the United States, India, Indonesia and Thailand as the fastest growing aviation markets.
A no-deal Brexit would result in 5 million fewer outbound trips made globally by 2022, Travel Weekly reports. These findings come from a new study by Euromonitor International. They also claim Spain will see the brunt of this, since UK travelers account for nearly 21% of inbound revenues in the country.
Following in Lyft’s footsteps, ride-sharing company Uber has launched a Ride Pass subscription option in select cities, Business Traveller notes.
Chicago’s O’Hare Airport received a new 2.5 million square-foot parking and car rental facility on Wednesday, ABC7 reports. The $242 million facility features 13 car rental agencies, 12 electronic charging stations and “innovative parking guidance technology”.
If you thought winter’s worst was over – oh boy, are you in for some fun! Much of Europe was plagued by extreme weather conditions ranging from heavy snows and freezing winds, CNN reports. Not surprisingly, the so-dubbed “Beast from the East” disrupted travel in Scotland, Ireland, England and most of mainland Europe.
The Mid-Atlantic and Northeast U.S. is experiencing its own weather problems, and as of Friday afternoon, USA TODAY notes airlines have already cancelled over 2,500 flights.
According to 4Hoteliers, a no-single use plastic hotel launches in Thailand in May. The hotel claims to be one of Asia’s first hotels to prohibit the use of plastics.
AccorHotels CEO Sebastian Bazin suspects mobile payments and interactive technologies like Google Home and Amazon Echo could threaten the hospitality sector, Hotelmarketing’com notes.
IATA aims to have one billion passengers fly on sustainable aviation fuel flights by 2025, TravelDailyNews International reports.
According to Skift, American Airlines and Qantas have filed an application through the U.S. Department of Transportation to form a joint business.
The same source reports Uber and Lyft drivers in New York City have received the green light to display ads in their vehicles.
In airport improvement news, Buying Business Travel reports Dubai International Airport will be upgrading its southern runway, resulting in a 45-day closure in 2019.
Chicago O’Hare International Airport may also be seeing some major improvements in the $8.5 billion USD range. The Chicago Tribune claims Mayor Emanuel and Chicago’s airlines are currently negotiating a deal to expand the airport as part of an eight-year plan.
Continuing on with this airport theme, Business Traveler writes Denver International Airport is officially a smoke-free facility, joining more than 600 airports across the country.
4Hoteliers reports Qatar Airways acquired the 174-room Sheraton Melbourne Hotel in a A$135 million deal (~$104.6 million USD).
According to Bloomberg, airlines are backing a startup that could fix the overbooking problems we’ve been witnessing recently.
Business Traveller notes Singapore’s Changi Airport is increasing departure fees for passengers in order to fund improvements to the airport.
House lawmakers blasted the Transportation Security Administration over its PreCheck strategies this week, USA TODAY reports.
In other TSA news, the organization is aiming to improve the transgender screening process, USA TODAY writes.
Another Friday, another Week in Review blog post! We’re rounding up the top industry news stories to keep you updated on the latest happenings in business travel.
London had quite a bit of trouble this week, first with the forced closure of London City Airport due to an operation to remove a 500 kg (1,102 lb.) World War Two bomb. According to BBC, all Monday flights were cancelled affecting up to 16,000 passengers.
Two days later, a vehicle collision at Heathrow resulted in one death and major flight delays and cancellations, Travel + Leisure reports.
According to Skift, Airbnb is set to launch a new tier of properties through its latest product, Airbnb Select. The program “invites selected hosts with high ratings and reviews to be part of a curated collection of listings that undergo an inspection and professional photography process.”
Lodging Magazine shares findings from a hospitality survey revealing the seven meeting trends of 2018.
A last-minute flight bidding app launched recently, allowing travelers to place bids on seats within two weeks of flying, Business Traveller notes.
As we continue to work our way through GBTA’s history, this week’s throwback post takes a look at the Association and industry through the 1980s. The late ‘80s brought about tighter travel budgets as the U.S. economy slowed, with corporate travel departments scrambling to cut costs where possible.
A Philippine consortium submitted a $6.7 billion USD (€5.38 billion) proposal to modernize Manila’s international airport, Reuters reports.
According to Aviation Pros, Munich Airport and Lufthansa have begun testing humanoid robot “Josie Pepper” in Terminal 2. The AI-powered robot can assist passengers by provding directions to their gate and other similar requests.
Singapore Airlines now offers complimentary Wi-Fi for its premium passengers, Business Traveller shares.
USA TODAY reports United Airlines takes the lead for on-time performance among other U.S. airlines.
The same source notes President Trump proposed to raise TSA fees for one-way tickets from $5.50 to $6.60.
According to Buying Business Travel, Uber is set to introduce a host of new safety features, including a 24/7 support line for both passengers and drivers.
In other ridesharing news, Business Traveler reports Lyft added 14 cities to its commuter tax program, allowing customers to use pre-tax dollars for Lyft Line rides.
Welcome to Hit The Ground Running - a new series of articles focused on the latest trends in ground transportation coming to you the second Wednesday of every month from official GBTA guest blog contributor, David Litwak of Mozio.
A couple years ago when we were negotiating with a major partner over a ground transportation RFP I found an unexpected clause: they wanted a competitive advantage and were proposing exclusivity in autonomous vehicles. I kind of chuckled, for two reasons: 1) I thought it was planning way too far ahead and 2) once autonomous vehicles arrived I believed they'd be a major transportation category, so I thought that was like asking for exclusivity in "cars" or “trains.”
But I realized that most travel managers and TMCs don't know what is happening in the ground transportation world, how they should manage the chaos, what they should pay attention to now vs ignore, and the questions they should be asking to manage their company’s ground transportation spend.
Every month brings another billion-dollar funding round for a rideshare company.
Toyota, Google and Ford are throwing around terms like Mobility Cloud and Mobility as a Service (MaaS).
Companies don’t know how to manage the security of increasingly affordable and convenient carpooling and public transit services.
The same rideshare company (read: Uber) can be in various stages of legal limbo in each market. How do you tell your employees you can use them in one location but not another, and actually enforce that?
Also, there are contentious battles about whether or not the cost premium of traditional black car providers is worth it, and whether or not rideshare companies are putting their riders in danger by cutting corners on background checks.
Travel managers often have to choose partners that will last them years, but these days many companies are reacting by just not dealing with the situation.
A healthy percentage have "don't ask, don't tell" policies around rideshare: they'll reimburse for it but they won't explicitly say you can use it or encourage it. And "official" ground partners often go unused by the vast majority of a company's employees.
As of now ground transportation is largely unmanaged.
This is the first in a series of ground transportation articles we're calling “Hit The Ground Running.” The point is to help you, the travel manager or TMC, navigate the massive upheaval in the ground transportation industry and figure out how you want to manage it.
To start I want to focus on a central question: is Lyft and Uber's pricing sustainable and how does it relate to the approaching autonomous car revolution.
Autonomous cars are still a long way away, but their looming presence is still felt in the pricing policies of Uber and Lyft, which have ramifications on the car rental market and traditional limousine providers.
Recent reports show that riders only pay about 41 percent of the cost of every ride on Uber.
This has led to many traditional car service companies to cry foul: Uber and Lyft will have to eventually increase prices. The current way of operating is not sustainable.
But I think they are focusing on the wrong thing: Uber/Lyft doesn't have to sustain these pricing policies forever -- they just have to sustain them until autonomous vehicles cut out the driver and their pricing becomes profitable.
Ben Thompson, the business analyst behind the website Stratechery, has a wonderful comparison of car ownership vs. using Uber in your daily life that I want to repeat here:
"Private cars (not including parking costs) cost about $0.50/mile for the average American. Uber, meanwhile, prices based on a combination of per-trip flat-fees, a price/mile, and a price/minute; taking a basket of cities the cost-per-mile for an average commute is $1.80/mile.
Add it all up and commuting with a private car costs $2,823/year, while an Uber costs $10,161. However, this doesn’t include parking: the average American pays $1,300 a year for parking,which bumps up the cost of a private car to $4,123/year, which is still a lot less than Uber."
Now this is for commuters, not for travelers, but I think car rental is analogous to temporary "ownership" of a vehicle in a destination so this is at least directionally accurate, and it shows the math behind Uber and Lyft’s pricing decisions.
80 percent of the cost of a ride is the driver in the car. Once autonomous cars are ubiquitous, Uber goes from subsidizing 40 percent of the ride to having a healthy margin.
Uber and Lyft are pricing for market share under the assumption that in 3-5 years, maybe longer, when autonomous vehicles arrive, they will no longer be losing billions a year and will become profitable. Until then, it's a land grab.
So in some ways, while Autonomous vehicles haven't arrived, we are already feeling the effects of them as investors subsidize rides in order to try to earn your loyalty.
As more Uber and Lyft competitors merge (Didi in China & 99 in Brazil), are acquired by car companies (MyTaxi by Daimler) or raise massive rounds (everyone), you should expect more and more market share to be taken up by these options, and for the market to get more fragmented as more of them expand into more geographies.
And because their incentives are marketshare, not profitability, as they wait out autonomous cars, their prices will be consistently lower than many other alternatives. It’s not irrational or unsustainable -- their incentives are just different.
What does this mean for you?
In short, at the moment, autonomous cars are only as relevant as they affect rideshare expansion, but you need a policy better than “Don’t Ask, Don’t Tell” regarding Uber and Lyft.
David Litwak is the CEO of Mozio (www.mozio.com), a ground transportation aggregator that integrates with 3,000 limos, express trains, rideshare, taxis and even public transit and provides corporations with websites and apps to book on-demand and in advance. Mozio runs AMEX GBT's "GBT Ground" platform and counts Carlson Wagonlit as an investor. David can be reached at firstname.lastname@example.org.
Ride-sharing services are a study in explosive growth. When Uber, the first large-scale ride-sharing service, launched in 2010, it was restricted to San Francisco and cost one-and-a-half times more than a taxi, according to Business Insider. By the next year, it had spread to multiple cities, had an app, and advertised itself as “Everyone’s Private Driver”. By 2013, Uber was advertising itself as a global service for all types of riders, but not necessarily business travelers. That would come in 2014, with the launch of Uber for Business.
Growth and innovation have followed the industry. Along the way ride-sharing services have attracted multiple entrants: Sidecar in 2011 (now defunct), Lyft in January 2012, taxi-pooling app Curb in 2014, China’s Didi Chuxing in 2015, Southeast Asia’s Grab in 2011, and India’s Ola in 2010.
Altogether, ride-sharing companies have created an industry with more than 9 million users and $3.3 billion in revenue in 2015, projected to grow to $6.5 billion in 2020. A good portion of that growth is expected to come from business travelers in North America. According to the latest GBTA Business Traveler Sentiment Index™, ride-sharing services are now allowed by 50 percent of corporate travel policies, a climb from 44 percent in June. Additionally, ridership among business travelers increased 21 percent and a majority of travelers anticipate using these services about the same (71 percent) or more (18 percent) in the three months following the survey.
Similarly, Certify’s Business Travel Ground Transportation Report for Q1 2017 states that Uber now represents 53 percent of business-traveler transportation receipts and tops the list of most-expensed brands. So regardless of whether your company has incorporated ride-sharing into its corporate travel program, it’s very likely that your travelers are utilizing this service.
However, growth has not come without bumps. Ride-sharing services have been banned in many states, cities, and countries, including Denmark, Italy, Hungary, Alaska, Vancouver, and Austin, Texas, according to Condé Nast Traveler. More than 8,000 ride-share drivers in Massachusetts were recently pulled off the road after failing a state background check, which does little to help ride-sharing providers’ alleged 90-plus percent driver-turnover rates. There are many stories of ride-share drivers committing crimes, with the most recent involving New York drivers using their cars to run a drug ring.
Not surprisingly, there has been much conversation about risks associated with ride-sharing services. Some of these risks mentioned include:
While not an exhaustive list, those responsible for their company’s travel management programs would do wise to research and address the items discussed above when making decisions to include or exclude ride-sharing vendors. At GBTA Convention 2017, we’ll be hosting a session entitled “To Ride or Not to Ride? Can Corporate Travel Programs Go Global and Stay Safe with Shared Economy Ground Transport Services?” The session will include four panelists representing those with real skin in the game and various sides of the debate. Join us on Wednesday, July 19 at 11:30 a.m. in Boston.