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Business Travel Industry is in Danger Because of the Coronavirus

As the latest study by the Global Business Travel Association (GBTA) states, the whole business travel industry is in danger because of the coronavirus outbreak. The latest epidemic can be potentially very harmful to the industry, costing as much as $46.6 billion per month. This is a true threat that the industry might be incapable of dealing with.

If the epidemic persists, this might cause the annual damage of US$559.7 billion a year, which is 20% of the forecasted spend in the industry in 2020. With the latest cancelations of large events in different parts of the world, such a big decline in revenues doesn’t look impossible anymore. Hotels in Barcelona already suffered from the cancelation of the mobile forum. Last week, Geneva hotels had to deal with a similar situation as it was decided to cancel the Geneva Auto Show, one of the biggest car exhibitions in the world.

The poll conducted by GBTA also revealed the following findings. Business events are losing popularity in light of the virus outbreak. Almost two-thirds (65%) of the surveyed companies say they had to cancel at least “few” meetings or events. Furthermore, 18% of the companies had to cancel “many” events. Many businesses prefer to postpone events until the coronavirus threat ceases. As it is not easy to move events and meetings to a new location last minute, the share of the surveyed companies that actually did that is not big. Instead, 66% of respondents decided to cancel at least several meetings or events. 17% had to cancel “many” meetings or events.

The uncertainty about the end of the epidemic is one of the biggest threats to the industry. More than half (54%) of respondents are not sure when they will be able to travel again. Approximately one-third of the surveyed companies (31%) hope that they will be able to try within the next three months. Finally, the remaining 14% think that travel will go back to normal within six months.

The coronavirus has the biggest impact on Asia and travel to Asia. The majority of companies (95%) decided to cancel their meetings and trips to China. The same applies to such destinations as Hong Kong and Taiwan – 73% and 54% respectively decided to cancel their events in these destinations. Nearly half of the surveyed companies (45%) decided to postpone or cancel their travel and meetings in Asia Pacific countries such as South Korea, Malaysia, and Japan. When it comes to Europe, the number of cancelations is smaller here – only 23% of the respondents decided to cancel their trips to some European countries such as Italy, Germany or France.

03.03.2020

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