Why the Global Financial Crisis Force Cuts Travel

Any economic instability in the investment market today can threaten the material lives of millions of workers, businessmen and taxpayers. The current global financial crisis has led to numerous financial setbacks in many enterprises, forcing the whole world to start the economy and reduce costs.

Thus, many luxury services were reduced to overcome the crisis and the resulting losses. As a result, the tourism industry has suffered from travel interruptions caused by the global financial crisis, and in particular by declining travel requirements for business people and regular travelers.

Available statistics show that a third of companies have actually stopped all business trips because they want to reduce travel costs, which are considered high business costs. According to a new study by the Business Travel Coalition (BTC) among more than 200 companies, one in four companies has made emergency discounts on total travel expenses in response to the current global financial crisis.

The survey was initially prepared by BTC in response to members’ concerns about the possibility of a new recession. About 40% of companies surveyed from 14 different countries said they had set up a full and total travel ice cream, while about 25% said they had reduced air travel only. Nearly 75% of the companies that set up the cuts acknowledged that the cuts would remain in place until further notice or a change in the current situation.

Completed research has found that cuts in travel budgets are good news for most low-cost transportation companies in the United States. A BTC spokesman said that the period of the fall of 2000 was marked by a recession-like fear. However, there is an increase in the size of the company’s reactions to the importance of the current situation and travel costs.

Many companies began to reduce air travel costs at the beginning of the year due to the deterioration of financial data points. Surveys conducted in the first quarter of the fiscal year did not recognize the downward trend. However, in the middle of the year it was widely grounded. BTC, to be ready for next year, unequivocally wanted to capture the response of companies to the economic crisis.

As the need for travel increased with the increase in travel, travel interruptions brought bad news to large firms. As a result, alternatives were adopted instead of this necessary need. Half of the companies surveyed said they were looking for alternatives such as video conferencing, canceling overnight trips and even train travel.

Other companies have introduced new policies that limit workers’ travel needs and force them to use some airlines, such as Easyjet or Ryanair.

Another study in support of the BTC study found that about half of the companies surveyed aimed to reduce their travel budgets by the end of the March 2009 economic year.

A survey by travel management company KDS found that almost 40% of companies had to postpone pre-arranged business trips, while a third had to postpone many international meetings and replace them with alternatives such as videoconferencing. .

These travel interruptions have worsened the tourism industry due to the current financial crisis and caused many losses to many international airlines. Some airlines have been forced to reduce the number of annual flights, especially in areas facing reduced travel costs. The new policies remain in place until further research is conducted on the impending financial crisis.

The current economic crisis has undoubtedly been bad news for thousands of industries and companies. Travel outages can help reduce the costs of some low-budget businesses, but have undoubtedly disrupted high-income businesses that are largely dependent on travel.

The next fiscal year will undoubtedly show the accuracy of the companies’ future responses and policies. The current policies will undoubtedly continue for some time until the financial crisis is resolved.