Global travel analysts have highlighted that South Africa’s corporate travel scene has changed due to a combination of post-pandemic challenges, load shedding, and rising inflation. <\/p>\n\n\n\n
According to Corporate Traveller’s new white paper – Economic Jet Lag: Understanding the Impact of SA\u2019s Economy on Business Travel – economic shifts have influenced business travel in the country, giving rise to a shift in travel habits.<\/p>\n\n\n\n
Broadly, these trends are:<\/p>\n\n\n\n
Bonnie Smith, GM of Corporate Traveller, said a major trend among South African business travellers is that they’re hitting the road less often but spending more.<\/strong><\/p>\n\n\n\n The data shows that the number of travel bookings is down slightly in the first six months of 2023 compared to the same period in 2019. <\/p>\n\n\n\n However, the number of room nights is significantly up and has, in fact, increased by 88%. <\/p>\n\n\n\n \u201cThis trend indicates that business travellers are opting to stay longer at their destinations and planning more meetings during their trips<\/strong>,\u201d said Smith. “We’re seeing business travellers clustering meetings to achieve more on each trip<\/strong>.\u201d<\/p>\n\n\n\n Interestingly, despite the decrease in travel bookings, the research shows a significant increase in spending in the first six months of 2023 compared to the same period in 2019. These increases have been observed both in international and domestic accommodation. <\/p>\n\n\n\n The transactional value for various other travel components has also increased significantly. Spending on domestic flights increased by 151%, international flights by 112%, domestic car rentals by 62%, and international car rentals by 224%, the report added.<\/p>\n\n\n\n The report showed that the reasons for these increases in spending, while bookings remain constrained, are varied.<\/p>\n\n\n\n It seems that business travellers today are leaning towards more premium services<\/strong>. <\/p>\n\n\n\n Instead of booking economy flights or standard hotel rooms, they may be choosing business class flights or luxury accommodations.<\/p>\n\n\n\n Of course, increased prices also play a significant role in the surge in travel spend. Prices for accommodation, flights and car rental are up across the line after the pandemic. <\/p>\n\n\n\n The increase in travel spend comes at a time when companies in South Africa are feeling the pressure of load shedding and inflation. <\/p>\n\n\n\n The report revealed that power outages in South Africa aren’t just leaving people in the dark; they’re reshaping the future of work and business travel.<\/strong> Persistent load shedding is putting the brakes on the hybrid workplace trend, disrupting virtual connectivity and online business events, said Smith. <\/p>\n\n\n\n “South Africa is pivoting from the global trend, trading in digital workspaces for face-to-face offices, thanks to Eskom\u2019s power failures.” <\/p>\n\n\n\n Smith added that face-to-face meetings are poised for a resurgence due to the struggle to keep the lights on. Power solutions are a financial black hole, forcing companies to opt for the certainty of in-person dealings. <\/p>\n\n\n\n Load shedding, ironically, is giving business travel an unexpected boost, making each trip a strategic play for maximum rate of return as companies scramble to maintain productivity in the dark.<\/p>\n\n\n\n Meanwhile, inflation has skyrocketed, with South Africa\u2019s central bank raising its benchmark rate to a 14-year high. <\/p>\n\n\n\n This has gnawed away the purchasing power of citizens and placed a burden on households leaving them feeling the squeeze from power shortages and energy price hikes.<\/p>\n\n\n\n “Inflation drives up travel costs, affecting accommodation, transportation, and meals – which has also played a role in the decline of travel bookings and longer stays at the chosen destination,” Smith said. <\/p>\n\n\n\n
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