Air travel is rebounding, but short-term mayhem means airlines and business travelers alike still have hurdles to overcome
By Keith Loria
Canceled flights are making headlines, and they are causing major operational headaches for business travel, both during travel and post-trip. That’s why it’s more important than ever for travel programs to prepare to deal with disruption challenges.
An April survey from the SAP Concur organization of 1,000 US business travelers revealed that 89 percent have been forced to take unexpected steps recently because of difficulty booking transportation and lodging for business trips. Much of this chaos was created by cancellations, delays, missed connections and uneven capacity.
In the early days of the pandemic, disruptions were very much driven by near-complete demand destruction as carriers dismantled their networks and schedules. As demand recovery picked up steam, bringing back network and frequencies proved to be challenging at times, mostly due to lack of available staff, both in the air and on the ground.
Looking back at fourth quarter 2021, Erik Shor, chief partnership officer, North America, for Corporate Travel Management, notes that demand spiked with airlines and airports attempting to staff back up. Then the omicron variant hit right in the middle of the December holidays, and airlines found themselves with elevated absentee rates leading to significant disruptions.
“With that, I don’t necessarily think that any one particular issue lingers on from the early days,” Shor says. “Rather, we are seeing an extended period of disruptions due to an ongoing confluence of challenges around lack of staffing and network/schedule rebuild. Add to that the normal challenges experienced with inclement weather and we see even more substantial service disruptions.”
Danny Finkel, CCO of TripActions, says the situation that confronts the industry right now, with flight cancellations and long support delays, is due to a combination of several factors. “Some airlines brought back entire fleets to meet to higher-than-anticipated demand for travel this summer, but have been unable to meet staffing needs due to various reasons, such as re-certifying pilots, getting necessary security clearances, and even greater than anticipated time off,” Finkel says. “Demand has outstripped supply, and when you couple that with, say, summer thunderstorms, it creates the domino effect of delays and cancellations that travelers are currently managing.”
On a global scale, as of early June net air transaction levels are about 60 percent of pre-COVID levels and they continue to rise, according to Craig Bailey, president Americas for BCD Travel. “We expect air transactions to reach 75 percent to 85 percent of pre-COVID levels by the end of 2022, varying by country and depending on the impact of omicron or other variants on flight availability and travel restrictions,” he says. “We advise our clients to ensure their travelers book through their TMC or online booking tool and use the automated tools at their disposal.”
Nick Whitehead, chief marketing officer for Serko, notes one of the main things he’s seeing is that flight disruptions during COVID have created a backlog of unused air credits. “A lot of organizations out there are still carrying massive air credit balances and aren’t sure the best way to deploy them in their travel programs,” he says. “It’s a real problem for companies and for the carriers.”
Through its Zeno tool, Serko is automatically converting canceled flight purchases to unused ticket credits and applying them to future bookings made through the tool.
“Something else we’ve seen is carriers addressing the problem directly with customers,” Whitehead says. “Qantas, for example, is consolidating company air credits onto a virtual card so corporates can spend the balance that way.”
Travel management is full of assumptions about what can and can’t be done, notes Chris Weedon, vice president global sales and service for GlobalStar Travel Management. Among the most common misconceptions is that consolidating travel spend, policy and supplier choices internationally only works for the world’s biggest companies. “Even if that was ever true, it certainly isn’t any more,” Weedon says. “In recent years, we’ve seen many small and medium enterprises expand their businesses worldwide, consolidating their travel programs and realizing the benefits.”
Cause and Effect Staffing shortages have been the real culprit behind many of the larger service outages, and CTM has seen a shortage of cockpit crew availability, most notably within the regional carriers that feed into the larger mainline airlines.
“The major carriers offered lucrative early retirement packages during the height of the pandemic,” Shor explains. “They’ve backfilled many of these positions with pilots coming from the regional airlines, which has led to unexpectedly high attrition rates at these airlines. Many of the mass cancellation programs that we’ve seen involve a significant number of flights operated by regional carriers.” That’s led to regional carriers lobbying Washington to consider reducing the minimum number of cockpit training hours from 1,500 to 750.
Another issue faced by airlines involves the lack of “bench resources” for those scenarios when pilots and/or cabin crews “time out” and reach their mandatory rest periods, prior to completing their scheduled flying. This can happen due to weather or equipment-related delays and often has downline consequences.
Bailey notes that US laws regarding passenger rights for delayed or cancelled flights aren’t as extensive as European or international laws, although there are some US regulations related to situations such as overbooked flights and tarmac delays. For instance, the European EC261 is one of the most comprehensive laws for passenger rights. Not just European travelers, but all passengers departing from a European airport are covered. “And in some circumstances, passengers flying into Europe from other worldwide destinations may be covered as well, depending on the airline,” Bailey says. “If it’s a European airline, they’re covered.”
TMC’s Approach For today’s travel programs, COVID has produced an enhanced emphasis on traveler tracking and well-being. A lesson learned from the beginning of the pandemic is that travel managers need broad and immediate visibility into travelers’ locations in case employees need to be relocated or notified. Now, after the pandemic, that visibility is standard. Travel programs need this proactive approach, but TMCs charge to monitor flight disruptions and act on them, to recover the investment of time and money into tracking, rebooking, communicating with travelers on the road, and dealing with the aftermath of disruptions, such as payments, unused tickets, extra hotels, meals, and so forth.
Booking through TripActions can act as an intermediary to mitigate some of these headaches, Finkel notes, along with providing tools that provide up-to-the-minute information to alert travelers to changes to an itinerary, such as delays or cancellations.
“If a flight is canceled due to airline-initiated scheduling changes, the onus is on the airline to find a suitable alternative flight or provide a credit for the value of the booking,” he says. “TripActions recently launched a proactive Click-to-Accept feature, which provides alternative itinerary options for travelers when a flight is canceled or delayed, helping to negate the need to contact airline support for such instances.”
Once multi-channel access is there, tools like self-serve itinerary management and click-to-accept schedule change are imperative when empowering teams and creating efficiencies. “Equipping travelers with tools that track flight performance, such as the percentage of flights leaving on time, the average length of delays, and the percentage of flights being canceled, helps with booking decisions,” Finkel says. “Modern travelers don’t get support solely by picking up a telephone; they also rely on media like chat or Twitter to manage itineraries – which is incredibly helpful when issues arise en route or in flight. Ensuring that a program has that multi-threaded approach to support is imperative in this environment.”
It’s hard for travel managers to better anticipate disruptions, Shor cautions, and airlines are trying to be proactive when implementing these types of programs. “What I would recommend is that travel managers make certain that both they and their TMCs are communicating with travelers when disruptions are announced,” he advises. “Travelers should also make sure to sign up for loyalty programs and do all possible to earn status as those with higher status will have more favorable outcomes when re-accommodations occur.”
The pandemic has generated a greater need for travel information, particularly with international travel where COVID restrictions and requirements (vax, testing, quarantine, etc.) vary. This increases complexity at a time when travelers are out of practice and suppliers are struggling with capacity.
“For example, our travel consultants are supporting travelers seeking more extensive assistance and advice, as they prepare to travel in an environment where supplier inventory and staffing are still low and frequent changes are the norm,” Bailey says. “Bookings – and information-gathering calls that don’t necessarily lead to bookings – are simply taking much longer than before.”
BCD Travel offers its TripSource mobile traveler app to help travelers stay informed of risk alerts, flight notifications, policy information and trip reminders. It also has DecisionSource, providing travel managers access to real-time travel and risk data, allowing them to monitor and respond immediately in case of an emergency.
The company’s COVID-19 Information Hub provides real-time information on country and city level restrictions, airline and hotel policies, airport information and testing locations, testing requirements, health certifications, digital health pass apps, mask and quarantine rules, vaccination dashboard, and more.
“While we can’t stop disruptions, we can help clients to better prepare their travelers,” Bailey says. “We advise our clients to make sure travelers update their profiles. Many employees haven’t traveled in the past two years and their profile information may be outdated. Updating their profiles won’t fix the root cause of a disruption, but it will save them time and hassle in case of one.”
Weedon says its noteworthy that clients who had not previously put much weight on the Corporate Responsibility (CR) aspect of traveling are now actively considering it post-pandemic.
“Many corporate clients are reviewing simple tracking and communication solutions to support their travelers on trips,” he says. “Travelers are more open to this kind of solution as it helps them feel supported by their company. Travel managers and travelers are seeing higher levels of disturbance in the supply chain than they are used to and therefore see more value in these tools.”
Making an Effort Domestic carriers are doing their best in a unique operating environment and tight labor market, though some of the hand wringing about a challenging summer for air travel is hyperbolic as summer storms and crowded airports long pre-date the pandemic. “To better accommodate travelers, airlines are investing heavily in digital infrastructure to help travelers navigate support and itinerary management,” Finkel says.
Delta, for example, just hired its first chief digital officer while American Airlines and other major carriers are now handling chat support through their apps.
“Outside of major weather events and one-off situations, most major US carriers have done an admirable job of being proactive with announcing and implementing measurable schedule changes,” Shor says. “This allows airlines to re-accommodate passengers weeks, if not months, out from their day of departure which minimizes the impact of disruptions.”
Dan Landson, public relations advisor for Southwest Airlines, notes the company is still recovering from the depths of the pandemic, rebuilding its network after thinning its schedule dramatically.
“On an average day pre-pandemic, we were flying an average of 4,200 flights per day, at the bottom of the pandemic, we were down to around 1,000 flights a day,” he says. “That was short-lived, however, and we added 18 destinations to our route map and now we’re rebuilding the network to add in more frequencies because business travel is rebounding.”
Southwest is on a mission to hire 10,000 people in 2022 to make up for the staffing shortages, support its growth and combat any future disruptions. “We take a measured approach to make sure travelers get to their destination,” Landson says. “If we see a disruption ahead, we notify them with as much time as possible so they can make alternate arrangements.”
Unfortunately, most observers in the industry don’t expect see much change over the next 12 months and possibly beyond. If anything, they warn, travelers and travel managers should set expectations around the probability that more disruptions are likely to occur as the summer wears on. Flights are still operating and hotels are still booking, just with some tightness around the margins.
“Until airlines have deeper benches of employees to better handle the waves of absenteeism and a reduction in pilot shortages, the carriers will unfortunately remain susceptible to larger disruptions to service,” Shor says. Travel is different now. Companies must give their travelers the tools and support to increase confidence and protect their health. “Travel managers must transform their travel programs into ones that help keep travelers moving safely and responsibly during a time of uncertainty and disruptions,” Bailey says. “Airlines, TMCs, and hotels are hiring and adjusting processes and making improvement, but it will take time since travel surged so quickly.”