Airlines Count on Zoom Fatigue to Drive Business Travel Revival

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(Bloomberg) -- After more than a year stuck on video calls, company executives are ready to hit the skies and meet customers face to face again, fueling airline industry optimism that business travel is poised to rebound despite the rise of Covid-era workarounds like Zoom.

The lifting of travel restrictions will trigger a sharp rebound in corporate travel, executives from Qatar Airways, IAG (LON:ICAG) SA and Rwandair said Tuesday on a panel at the Qatar Economic Forum. Business-class occupancy on Qatar Airways flights is 10 percentage points higher than it was before the pandemic in markets where travel is allowed, said Akbar Al Baker, chief executive officer of the Gulf carrier.

“People don’t like to just sit in front of a screen and conduct business,” Al Baker said. “Businessmen like to face people, they like to feel people, they like to notice the body language.”

Even as air travel slowly rebounds with the rollout of vaccines gathering pace in most major economies, getting business travel back on track is a key objective for airlines since the premium seats are such a big profit contributor. With face-to-face travel cut off, many companies have adopted new methods of reaching out to customers and co-workers. Those adjustments, along with a rising imperative to reduce carbon emissions, has led to questions about whether corporate road warriors will return in force after the health crisis is over.

“The shape of business travel may change, but face-to-face meetings are going to be crucial,” said Luis Gallego, CEO of British Airways parent IAG. About half of IAG’s corporate customers -- a group which contributed about a third of the carrier group’s revenue pre-pandemic -- have said that they will fly before the end of the year, Gallego said.

While companies may cut down on internal travel, they will continue to send executives to meet customers and build new markets, Boeing (NYSE:BA) Co. CEO David Calhoun said on the same panel.

“It’s a net gain for travel,” Calhoun said. “We live on competition, competition is what drives travel.”

Before any of that can happen, travel restrictions need to be lifted, aviation officials maintain. Carriers are pushing for governments to coordinate on rules to help reopen international and long-distance routes.

“Vaccinated people should be able to travel freely,” said Rwandair CEO Yvonne Makolo. Otherwise, continued quarantines and travel restrictions will continue to disrupt the industry and delay the recovery, she said.

The Qatar Ministry of Commerce and Industry, Investment Promotion Agency Qatar and Media City Qatar are underwriters of the Qatar Economic Forum, Powered by Bloomberg.

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