Business travel expenses are making a comeback for airlines. Zoom is a competitor, though.
Spencer Platt via Getty Images
If you’re looking for proof that, at least mentally, most of us are on the brink of a pandemic, look up.
On Wednesday, United Airlines reported more than $12 billion in first-quarter revenue, the company’s biggest profit in a decade. On Thursday, American Airlines told investors it posted its first quarterly profit since the outbreak.
These companies’ flights are usually full of vacationers. But a profitable passenger is also returning to the sky: the business traveler.
Justin Strelow is generally happy to be traveling for business again. Although he doesn’t enjoy any part of it.
“I don’t eat at the airport. I’m trying to lose a few pounds,” Strelow said. “I’m trying to lose weight with my disease.”
Strelow is a partner of Insysiv, a Kansas City, Missouri company that makes software for clinical labs. In two weeks, Strelow will fly himself and three employees to Anaheim, California, to show business. Even without the airport Cinnabons, the move would have cost his small business about $15,000.
“I’m still kind of old school. I love face-to-face with people,” Strelow said. “We’ve had the honor of getting in front of people in person and strengthening those relationships.”
That is music to the ears of the airlines. Before the pandemic, business travel accounted for more than 50% of profits, said Ryan Mann with consulting firm McKinsey.
“Business travelers tend to book at the last minute, and that’s when the prices are the highest,” Mann said.
Business travel is about 70% of its destination in 2019, according to flight data company Arc.
Mann said Zoom has replaced small, in-person meetings that involve walking, “but meetings, in essence, fill the gap.”
As are corporate retreats and corporate trips where remote workers can see the height of their colleagues.
While business travel is booming, it’s an open question whether it will ever fully recover. Anxiety can make this more difficult.
“This is an area where they can cut costs, and there’s a proven way to do that in Zoom,” said Chris Raite, an analyst at investment research firm Third Bridge.
Plus, you don’t have to worry about Zoom delays due to the lack of a pilot.
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