In a business where fewer than 20 percent of customers once delivered more than 50 percent of total profits, it’s not surprising that those customers received preferential treatment. In the case of airlines operating before the Covid pandemic, it was their business travelers who received preferences, one of which was more flights operating each week between big cities versus other destinations.
But with the post-pandemic situation quite different, that business-traveler perk seems to be going away, at least temporarily. For instance, a recent article from Reuters notes that “JetBlue will redeploy capacity away from New York to maintain high-margin leisure destinations, as its business travel demand is 20 percent below pre-pandemic levels.”
In addition, Alaska Air has reduced its seat capacity into and out of California cities by nearly 25 percent, while flying more frequently to leisure destinations in Mexico and Central America. And “Southwest is shifting the frequency of its flights from mostly short-haul business routes to medium- and long-haul routes,” says the Reuters article. “The airline will also move flights from early-morning or late-evening hours and cut flights on Tuesdays and Wednesdays by about 10 percent compared to other weekdays.”
If other airlines follow suit, one effect on meetings could be that Wednesdays—traditionally the busiest travel day for attendees because of the meeting patterns preferred by host hotels—see fewer flights into and out of various destinations. Further, event speakers and other participants might have to fly into a meeting destination one night earlier to ensure they get to the event on time, while some attendees might duck out of a meeting early on the final day to catch a flight home.
As a result, researching airlift might have to move higher up on a planner’s to-do list when scouting destinations and properties.
There is, though, one bit of good news from the most recent batch of airline-passenger data: U.S. travel demand appears to have peaked, taking away pricing power from the airlines. The U.S. Bureau of Labor Statistics found that air-ticket prices in June 2023 were nearly six percent lower than in May 2023, nearly 20 percent lower than in June 2022, and even 1.3 percent lower than they were in June 2019.
So, while participants for your upcoming meetings might have more difficulty finding convenient flights into and out of your host destinations, they will likely pay less than last year for the journey.
