Rising costs, delays likely to slow business travel, managers forecast

Business travel accounts for about $165 billion of the roughly $700 billion spent each year on domestic travel. Since overall travel began recovering in 2003, spending on business travel has been increasing. Until now.

Although no hard data is available, it appears that business travel will be slowing over the next year. The main reasons corporate travel managers cite are the extensive flight delays this year and rising costs.

"Some companies are putting in much tighter controls about flying," said Susan Gurley, executive director of the Association of Corporate Travel Executives, a trade group. "There's an increased frugality, and I think everybody is becoming more conscientious" about weighing the benefits of a trip against the costs.

Air fares in general are not rising yet. According to the Travel Industry Association, average domestic air fares actually dropped 1.3 percent in August compared with August 2006. But other factors, especially a 6.5 percent rise in average hotel rates, drove overall travel costs up 2.4 percent for the month.

As spending is more controlled, we'll be hearing more about alternatives to the headaches of business travel. Yes, we are back to talking about teleconferencing.

About five years ago, when teleconferencing was first widely presented as a way to reduce travel costs, I had a good look at the technology, which was marvelous. With great audio and wraparound video screens, you really felt as if you were with the other participants, even though they might be far away.

But there were several problems with teleconferencing. The technology was expensive. And even if you had a system, the other person or company had to have one, too. At first, teleconferencing often merely replaced internal phone calls or e-mail messages with televised intraoffice "meetings." What once would have been accomplished quickly became an in-house television program.

Gurley said many companies were working through those problems as teleconferencing systems became more common.

Teleconferencing aside, those of us who actually need to get on an airplane regularly are still left with a system in disrepair, with airlines under growing political pressure to shape up. Last week, in calling for the Transportation Department to address the problems more effectively, President Bush noted the "egregious behavior" of airlines as passengers were stranded for hours on planes and delays piled up in a system stretched so thin that it could not deal with even routine weather disruptions.