Companies cut travel costs in response to economic crisis

[NickN]

JQ and DJ will be happy......

By John Wright

May 20, 2009 12:01am


Execs told to fly economy, cut down on meals
Companies cut travel costs aggressively
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COMPANY executives are being told to fly economy, share hotel rooms and eat cheap, coffee shop breakfasts in a new age of austerity.

Companies have cut travel costs aggressively in response to the economic crisis, slashing about 20 per cent off national corporate spending since January, the Herald Sun reports.

Shannon O'Brien, chief executive of Flight Centre's corporate travel arm FCm Travel Solutions, said the downgrading of arrangements for executives had affected every aspect of the industry.

"They (executives) are moving to the back of the plane, they're moving from corporate junior suites to ordinary hotel rooms and people travelling together are being asked to share rooms," he said.

"Corporates have moved to cheaper alternatives across the board.

"There has been a major shift away from using airline loyalty programs to 'best fare of the day' travel."

Mr O'Brien said that while many large corporations were continuing to use larger, upmarket hotel chains for their executives, they were demanding, and receiving, better discounts and add-ons.

Other, smaller corporations with less buying power had been shifting away from five-star hotels to cheaper ones.

"Two or three people travelling together might be asked to share a flat and rather than eating breakfast at a hotel buffet, they might opt for a cheaper alternative in a coffee shop," Mr O'Brien said.

"The climate is challenging, and corporates have to make sure of a good return (for their travel investment)."

Queensland-based accommodation specialist Oaks Hotels & Resorts said yesterday a corporate shift away from five-star hotel rooms towards flats had helped the company weather the economic crisis.

Chief executive Brett Pointon said the Oaks group, which had 35 properties in Australia had seen a fall in business but had maintained occupancy rates by writing new corporate contracts.

Mr O'Brien said most in the industry expected a prolonged downturn in business.

http://www.news.com.au/dailytelegrap...014099,00.html