Southwest Airlines has announced it is adding new daily flights in Q4 in hopes of gaining a larger market share of corporate travel. This announcement may help business travel to begin its road to recovery in the US.
Business and MICE travel was the first type tourism demand to be impacted by Covid-19 as conferences and events were suspended or cancelled from the onset. Business tourism now has the opportunity to rise again after being non-existent due to the ongoing impact of Covid-19.
It is critical for corporate travel to regain some sort of normality to help revive the drained economy in the US. According to GlobalData, the US saw 461.6 million business trips in 2019 and was forecast to further increase at CAGR of 2% between 2019 and 2021 (pre Covid-19). This highlights that a strategy is needed to be able to encourage these numbers once again, business travel is a significant reason as to why the demand for domestic tourism in the US is so high. Southwest Airlines is supporting this strategy by concentrating on the vast domestic tourism market and in doing so, it will have the opportunity to gain an increase in market share.
However, IATA anticipates full demand for flights to return in 2023 and business tourism could take even longer as health and safety are a priority. According to GlobalData’s COVID-19 Week 9 US consumer survey, respondents are still highly concerned about the impact of Covid-19. 47% of consumers highlighted they are ‘extremely concerned’ and 31% highlighted they are ‘quite concerned’ regarding the current pandemic.
The WTTC (World Travel and Tourism Council) unveiled at the beginning of June the second phase of measures aimed at rebuilding global consumer confidence, to encourage the return to travel. The announcement highlighted measurements for the return of business and MICE tourism. This shows that this type of tourism does have the potential to begin recovery soon. Southwest Airlines will profit from this in focusing on corporate travel and promoting the new flights which will benefit mainly business travellers.
There is huge potential to boost the drained economy in the US if Southwest Airlines does promote heavily to organisations and highlight the new business focused flights as travel restrictions are easing. However, health and safety holds the greatest importance, meaning business travellers will need reassurance and their safety guaranteed in order to resume travelling once again.
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By GlobalData
