As economy flies high, so does corporate air travel: Business flyers pass pre-Covid numbers

Corporate air travel has surpassed pre-pandemic levels, contrary to the perception that it has taken a back seat with virtual meetings becoming the order of the day after Covid-19.

“The last six months have been exceptionally strong... Our corporate revenue has grown by over 30%," said a senior executive at IndiGo. Air travel plummeted during the virus-induced lockdowns, and has since been on the recovery path.

Executives at airlines and travel companies said increased activity among IT, mechanical, banking services, and pharmaceutical companies is driving the trend. At a time when fares are rising amid capacity cuts by airlines, the growth trend in corporate travel is seen to be stickier than that in the more price-sensitive leisure travel segment.

The IndiGo spokesperson said the airline has seen consistent growth in corporate, as well as small and medium enterprises (SME) travel, month-on-month during July-December 2023.

In its post-earnings call with analysts on February 2, IndiGo chief executive Pieter Elbers said corporate travel was back to what it was prior to Covid — even slightly higher — fuelled by economic development of India. “If we look at economic numbers quarter-overquarter and if we look at even the GDP forecast, going forward, I think we canbe reasonably confident corporate-driven or business purpose-driven traffic will continue to grow,” he had said.

Executives at travel companies such as Cleartrip, MakeMyTrip, and Thomas Cook, too, said they have seen a bounce-back in the segment.

Ayyappan R, chief executive of Cleartrip, said the company’s corporate air travel business is growing at double the pace of its consumer business. “All put together, B2B is today 30% of our revenue pie. The scaleup and increase happened in the last 12-18 months,” he told ET.

Rapid resurgence
Raj Rishi Singh, chief marketing officer (corporate), at MakeMyTrip, said the trend challenges the initial theory that virtual communication would replace corporate travel in the post-pandemic era, and indicates that the intrinsic value of face-to-face interactions is still a business imperative.

“The need for travel in the corporate space is now at an all-time high,” he said. MakeMyTrip is the country’s biggest travel portal.

Indiver Rastogi, president, global business travel, at Thomas Cook (India) and SOTC Travel, said business trips have seen rapid resurgence postpandemic, with the company posting sustained momentum of 20% year-on-year growth during April-December 2023.

“Demand is back across the board, with consulting, FMCG and IT-enabled services fuelling our growth trajectory,” he said.

Underlining the economic optimism, recent data from HSBC showed that a faster rate of expansion in new orders likely pushed Indian private sector activity to a four-month high in January.

Globally, corporate air travel accounts for 25-30% of all movements currently, MakeMyTrip’s Singh said, adding that the same holds true for India as well. He said the SME corporate customer count of MakeMyTrip totals 56,000 while the number of large business customers is over 2,400. He did not provide comparative figures.