Welcome to the March 2009 Issue of Travology Today

When trying to gauge additional cost-saving measures on your travel program, now is the time, when budgets are still tight, to look very closely at airline and hotel contracts and re-negotiate wherever possible. All vendors are open to dialogues, and especially now, are somewhat more willing to entertain some flexibility in certain markets. Directravel has a team in place, led by Jim Hayes, that is available to take a look at your current travel program on a more detailed basis and help with these negotiations. For more information, please contact your National Account Manager.

In addition, the following information may prove helpful:

• Domestic flights decreased 5.2% from previous years; international flights were down 1.7%
• US airlines carried 4.3% fewer domestic passengers during 2008 that in 2007
• Hotels will continue to use surcharges to generate revenue
• This is a point for re-negotiation
• There is no more “corporate rate”; look for BAR or Best Available Rate
• For hotels, local deals are somewhat easier to manage than national deals, especially if you are looking at 1,000-5,000 room nights in a market.
• Travel policy compliance and enforcement remain a challenge for travel managers, but a strong way to manage cost savings.
• For example, fly business class to a destination, but coach back
• Instead of allowing Business Class tickets for a 5 hour flight, expand this to 6-7 hours

Business Leader Survey: Companies that Maintain Travel Spending Could Gain Competitive Advantage

A new survey of business leaders finds that while corporate travel budgets are often the first target of cost-cutting measures, a majority believe that companies that increase travel budgets during an economic downturn will be better positioned to build competitive advantage.

Nearly three-quarters (72%) of businesses surveyed say that increasing travel while others are cutting back creates an opportunity to build market share and new customer relationships. Half (53%) also believe that companies that reduce their business travel will give an advantage to competitors who maintain their travel commitment.

The findings illustrate the conflict within businesses that are under pressure to quickly identify cost reductions in the economic downturn. When making these reductions businesses may sacrifice longer-term strategic and competitive advantage.

“It’s a classic trade off between short term cost-reductions and long term value,” said Kellogg Business School Professor Daniel Diermeier, a Distinguished Professor of Regulation and Competitive Practice. “During times like these, many companies will go too far, and actually cut back on the activities that would best position them to compete in the future.”

The survey of business executives at companies with more than $50 million in annual sales found that:

• 82 percent of companies surveyed believe that business travel is important to achieving their business results;
• 81 percent believe that more client contact is necessary in a slow economy;
• A strong majority (59 percent) strongly agree that in-person contact grows their business; and
• 72 percent of businesses believe that increasing travel while others are cutting back creates an opportunity to build market share and new customer relationships.

“Travel plays an important role in business growth in a down economy, by helping businesses connect with their customers,” said Dr. Suzanne Cook, U.S. Travel’s Senior Vice President of Research. “It’s also clear from our survey results that the old maxim remains true; if you don’t take care of your customers, someone else will.”

For more information, click here.

Companies’ commitment to a Corporate Social Responsibility (CSR) platform is no passing fad, according to the latest annual opinion poll by the Association of Corporate Travel Executives (ACTE) and KDS , the European leader in on-demand travel and expense systems. However, certain aspects of CSR such as ‘green’ forms of business travel, are beginning to suffer in the recession, as organizations prioritize cost-saving over supporting sustainable travel.

This is the fourth consecutive year that ACTE and KDS have gauged business opinion on issues around CSR and business travel. The latest survey was conducted between December 2008 and January 2009, and captured the opinions of 329 travel managers and business travelers from around the world, the largest-ever response to an ACTE/KDS survey and a 52% increase from last year’s respondents.

Confounding the skeptics, the study found that companies are not being blown off course by the global recession in seeking to promote CSR:

• 61% of organizations now have a CSR charter (versus 59% in 2008)
• 27% of organizations prefer to do business with suppliers and partners with a CSR charter
• 28% of corporate travel departments are required to report to management on carbon emissions performance
• The most common CSR activities are reducing energy waste within company buildings (76% of companies), contributing to the local community (55%), cutting carbon emissions in production plants (34%) and using carbon offset arrangements (25%)

However, this commitment to CSR does not automatically translate into greener travel choices, as these often entail higher financial costs. The survey finds that companies see cost-cutting as the top business travel concern (rated a high priority by 79% of companies), while environmentally sustainable travel is a high priority for only 17%. Overall, environmental sustainability is rated only a mid-level priority for business travel, ranked at this level by 48% of organizations.

Greater concern about our impact on the environment appears to be more of a European phenomenon. Only 35% of US respondents said they would consider their carbon emissions when planning business travel, compared to 42% of Europeans.

Meanwhile, the United States has already seen a greater focus on cost-cutting in the travel budget, suggesting that the situation in Europe may well worsen during 2009. Overall, 70% of respondents said their company has sought reductions in the travel budget to save money; for US organizations the figure was 80%. Similarly, while 54% of respondents said they had been asked to cut their number of business trips because of the economic crisis, the figure for US respondents was 64%.

Susan Gurley, ACTE Executive Director and Chief Staff Officer, said, “The survey shows that, contrary to some predictions, Corporate Social Responsibility has not fallen from favor in these challenging times. Instead, the figures show that it is steadily gaining ground and becoming part of the DNA for organizations around the world. However, it also puts to rest the myth that good CSR practices automatically include greener travel choices. Under present economic conditions, green travel choices may frequently conflict with the greater urge to cut costs.”

Yves Weisselberger, CEO of KDS, commented, “At this stage, green travel choices remain scarce and are usually more expensive. For example, European companies can send their staff by high speed rail, which is low in emissions but often more expensive than a low-cost flight. However, in the current economy, paying a premium is hard to justify, so green business travel will lose out. Longer term, though, the picture is brighter – companies clearly want to do the right thing through CSR, so once the financial premium is erased, or the economy permits, we should expect to see green business travel become far more popular.”

To view the full report, click here.

The National Business Travel Association (NBTA) praised President Barack Obama for recent Administration statements in support of business travel and the travel industry. While many had interpreted earlier statements by Obama to mean that he discouraged travel, the Administration explained that he supports a strong travel industry because it is important to the nation’s economy and “encourage[s] people to travel.”

Separately, Senate Majority Leader Harry Reid (D-NV) sent a letter to Department of Treasury Secretary Timothy Giethner requesting that Treasury promptly establish the guidelines required by the recently-passed stimulus package for certain expenditures by companies that have received Troubled Assets Relief Program (TARP) funds. The request mirrors a call made by NBTA and other travel industry organizations for the guidelines.

Reid’s letter notes: “…conventions and meetings are a routine and accepted part of running a successful enterprise in this country. Sales of products and services, networking opportunities, and negotiating and consummating transactions all come from these types of meetings, leading to productivity and growth for companies that ultimately create jobs. In turn, these functions create another 2.4 million jobs annually for those businesses that host and provide services to them.”

The Majority Leader expresses concern that public reaction to the “misuse of taxpayer funds by TARP recipients” is leading companies to cancel important travel out of concern about public perception, noting that the cycle could lead to the loss of nearly a quarter million travel-related jobs this year. Reid writes that completing the guidelines could provide the business community the right assurance that smart business travel, meetings and conventions should continue.

NBTA Executive Director & COO Bill Connors, CTC, commented, “President Obama and Senator Reid are demonstrating outstanding leadership by trying to put an end to the dangerous demonization of business travel and meetings. We are pleased that they are telling American citizens and companies that travel is essential to the conduct of business and economic recovery. This is a victory for the thousands of people who have used the NBTA website to write their elected officials on this issue. Our efforts are paying off, and the message is getting through – travel moves business.”

For more information, click here.

On June 1, 2009, U.S. citizens returning home from Canada, Mexico, the Caribbean or Bermuda, by land or sea, will be required to present one of the travel documents listed below.

Many of these documents are already available, and obtaining one now will ensure that you are ready on June 1, 2009, when they will be required.

U.S. Passport This is an internationally recognized travel document that verifies a person’s identity and nationality. It is accepted for travel by air, land and sea.

U.S. Passport Card This is a new, limited-use travel document that fits in your wallet and costs less than a U.S. Passport. It is only valid for travel by land and sea.

Enhanced Driver’s License (EDL) Several states and Canadian provinces/territories are issuing this driver’s license or identification document that denotes identity and citizenship. It is specifically designed for cross-border travel into the U.S. by land or sea.

Trusted Traveler Program Cards NEXUS, SENTRI or FAST enrollment cards can speed your entry into the U.S. and are issued only to pre-approved, low-risk travelers. The cards are valid for use at land or sea; the NEXUS card can be used in airports with a NEXUS kiosk.

Knowing what documents are required and having them ready when you return home will help streamline the entry process and ensure your return to the U.S. is as smooth as possible

For more information, click here.

In recognition of Women's History Month in March, American Airlines has launched a special Admirals Club® membership offer. Customers who visit AA.com/women, the airline industry's first online resource specifically designed for its female customers, can print out a flyer and present it to any Admirals Club lounge representative on or before May 15 to save up to $50 off a new annual membership or $25 off a membership renewal…Continental Airlines on Wednesday, March 25, became the first U.S. carrier to inaugurate scheduled service between New York and Shanghai, China, with daily nonstop flights from the airline's hub at Newark Liberty International Airport.…Delta Air Lines announced a name change for the airline’s more than 50 airport lounges worldwide as part of the merger with Northwest. The new moniker, Delta Sky Club™, will replace the current Delta Crown Room Club® and Northwest Airlines WorldClubs® names…The U.S. Department of Transportation (DOT) announced that it has tentatively awarded US Airways new route authority to Rio de Janeiro, Brazil. The flight number and aircraft for the daily service will originate in US Airways’ Philadelphia hub, fly to the airline’s largest hub in Charlotte, N.C. and then on to Rio de Janeiro. Service is tentatively scheduled to begin in fall 2009.

in January increased to 77.0%, up .06 points vs. the running 12 month average of 76.4% and up 11.7 points from December’s 65.3%. To view the USDOT's Bureau of Transportation Statistics' (BTS) Air Travel Consumer Report, click here.

The United States Government has posted recent travel advisories and warnings for Afghanistan, Algeria, Burundi, Chad, Colombia, Cote d’lvoire, Democratic Republic of the Congo, Eritrea, Georgia, Haiti, Iran, Israel, the West Bank and Gaza, Kenya, Lebanon, Nepal, Nigeria, Pakistan, Philippines, Saudi Arabia, Somalia, Sri Lanka, Sudan, Syria, Uzbekistan, Yemen and Zimbabwe.