Last Wednesday, I took my first business trip in ~18 months. My first time in an airport, on a plane, or staying at a hotel (lodge). And yes, it was delightful.
But . . .
Normally, this is a 60-70 persons group, but this year’s Covid protocols changed all that. The weekend event was broken into two successive weekends, each half the usual size. Everyone – attendees, speakers, staff, guides, and waitstaff – were required to show proof of vaccination. We each had our temperature taken 2X a day.1
The only protocol upgrade I would have made: Upon arrival, everyone gets tested for Covid. (I do this each week when I arrive at Bloomberg HQ (it is a complex and expensive undertaking).
Despite all these prudential steps, there was still an 8% last-minute cancellation rate from people who are concerned about the Delta Variant. No judgment – I do not know the particular medical issues they may be trying to protect young, unvaccinated and/or immuno-compromised members of their families. But it does raise a simple question:
How F*cked Is Business Travel?
Pre-Delta, the travel sector was in the midst of health recovery – one that is now “Thrown Off Course by Delta Variant.”
I suspect this is a far more complex question than it appears at first. Delta is causing a rethink of discretionary travel, but the pandemic lockdown experience is making many take a cold hard look at the inefficiencies of business travel.
During the lockdown, I have presented at numerous virtual conferences – my takeaway is that it is easy as hell. I am typically finished – shower, shave, dress, present – in less time than it normally takes me to get to the airport. How wants to get back on the road after that?
Whenever I have an inkling of a shift in the economy, I look for market signals that confirm my priors. I also try to find disconfirming evidence, but that’s so much harder.
Two headlines leaped out at me suggesting that others with a substantial economic interest in business travel are getting nervous. The first was a pre-Delta Variant concern on July 1: American Express was raising its already pricey Platinum card to $695 a year,2 but adding more perks. The second was the post-Delta news yesterday that “JPMorgan won’t be raising the fee on the $550-a-year Sapphire Reserve;” Chase is “offering new rewards for dining, hotel stays, car rentals and air travel purchased through its rewards portal.”
Competition between the two leaders in the space is part of it, but perhaps the bigger competition is the concerns raised above. Do I really need to go on this trip? Do I want to risk my health or that of loved ones, spending days of work, travel, hotel, poor eating, out of my routine and comfort zone, for a meeting that lasts an hour or two?
That is the challenge for those who work in the business travel sector. Note: This is before you even start thinking about what the rules are for where you can Internationally: Where can you go? Where is it safe to go?
Have a look at the Bloomberg Travel Tracker (Aug 10): This looked like an enormous undertaking with countless people working on this for God knows how long. Then it has to be updated because all of those rules and guidelines are subject to change without notice. How soon is this out of date? What do you have to do to keep it current? It’s a monster undertaking.
International Travel During Covid-19: Where Can You Go?
I booked a vacation in February for the Caribbean – I wish I had a tracker on the odds it gets canceled.
A World Awash In Capital (August 9, 2021)
The Economic Risks from Anti-Vaxxers (July 15, 2021)
Contrarian Take: Covid Vaccine & the End of Anti-Vaxxers (December 2020)
1. Elevated temperature leads to a Covid test, and if you are negative, you are required to wear a mask. If positive, you depart.
2. It does come with a variety of services that effectively cut that cost substantially. Still, that’s a lot of money for the privilege.