November 16 - Paris Terror Attack Impact On Travel Demand


UPDATE: 11-24-15

Feedback this week from travel managers is that some companies are continuing to avoid travel to France to monitor the situation. The State Department warning only reinforced their decisions. Many companies are allowing employees broad discretion with regard to travel to France and other European countries, as there are heightened security alerts and public events being cancelled. Some companies are moving to mandatory booking of hotels through their travel agencies and others ware implementing smart phone tracking.

After 911, most companies and their travelers saw it as an extraordinarily planned, one-off attack with the U.S. government in control of the situation. Travel rebounded steadily; there was confidence. With the Paris attack, and Brussels under lockdown, there is little confidence that Western governments have a plan to solve the Syria problem or a grasp of the ISIS threat and a coherent strategy to neutralize them. Moreover, there is a strong sense that Europe does not have a workable immigration or boarder-control policy. This lack of confidence coupled with the prospect for new attacks could push travel recovery out for some time. 

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BUSINESS TRAVEL COALITION

Survey Results

Paris Terror Attack Impact On Travel Demand

Washington, DC - Business Travel Coalition conducted a survey over the weekend into Monday in response to the terror attacks in Paris last Friday evening. The purpose of the survey was to provide an early snapshot for travel and risk managers to understand how companies and other organizations are responding regarding potential near-term travel policy changes. Eighty-four (84) corporate, university and government travel, sourcing and risk managers from seventeen (17) countries participated in the survey. The survey can be found at http://btcnews.co/1WYOShA.

Importantly, the results are prospective in the sense that any travel policy changes, for most organizations, have not yet been decided upon, but rather, are under consideration in real time. As the French government investigation proceeds, and facts change, e.g., discovery of additional imminent attacks, or actual attacks, organizational responses regarding travel policy could change significantly. The survey results provided below will act as a baseline for future surveys to gauge response to moving circumstances.

SUMMARY RESULTS

- 20% of survey participants are very or somewhat likely to cancel travel to France for some period of time.

- 20% are somewhat likely to cancel travel to to/within Europe for some period of time.

- 70% are very or somewhat likely to allow employees discretion with regard to travel to France

- 55% are very or somewhat likely to allow employees discretion with regard to travel to/within Europe.

- 16% are very or somewhat likely to cancel travel to France until the investigation determines if the attack is just one of many in the planning stages

- 5% are very or somewhat likely to cancel travel to/within Europe until the investigation determines if the attack is just one of many more in the planning stages.

- 30% are very or somewhat likely to cancel travel to France if the attack is just one of many more in the planning stages until strategic modifications to travel policy are considered.

- 35% are very or somewhat likely to cancel travel to/within Europe if the attack is just one of many more in the planning stages until strategic modifications to travel policy are considered.

- 55% indicate their company’s Duty-of-Care policy will drive any modification to travel policy.

ANALYSIS

Not surprisingly the vast majority of companies/organizations are likely to provide their employees personal discretion regarding travel to France and to and within Europe – 70% and 55% respectively.

Some 20% of survey participants are likely to cancel travel to France and to and within Europe for some period of time. If the French government investigation determines that Friday’s terror attack was just one of many more in the planning stages, then 30% of organizations indicate that they will likely cancel travel to France until strategic modifications to travel policy are considered. Of course, additional terror attacks could cause further significant erosion in travel demand affecting all travel sectors.

The airline industry is a highly leveraged one in the sense that the last several passengers that board an airplane can often make the difference between profit and loss on any given flight. As such, the percentages of potential restraint on demand discovered in this survey should be of concern to governments, airlines, hotel and rental car companies and other travel and tourism providers. In the coming days airline and other booking data should shed more light on the terror attack’s impact on travel demand.

SURVEY QUESTIONS & RESPONSES

Given what we know now about the attacks how likely are the following travel policy modifications?

My company will cancel to travel to France for some period of time.

10.5% Very likely

10.5% Somewhat likely

42.1% Somewhat unlikely

36.8% Very unlikely

My company will cancel to travel to/within Europe for some period of time.

0%   Very likely

20% Somewhat likely

20% Somewhat unlikely

60% Very unlikely

My company will allow employees discretion with regard to travel to France.

25% Very likely

45% Somewhat likely

15% Somewhat unlikely

15% Very unlikely

My company will allow employees discretion with regard to travel to/within Europe.

35% Very likely

20% Somewhat likely

30% Somewhat unlikely

15% Very unlikely

My company will cancel travel to France until the investigation determines if the attack is just one of many in the planning stages.

5.3%   Very likely

10.3% Somewhat likely

26.3% Somewhat unlikely

57.9% Very unlikely

My company will cancel travel to/within Europe until the investigation determines if the attack is just one of many more in the planning stages. 

5%   Very likely

0%   Somewhat likely

20% Somewhat unlikely

75% Very unlikely

If the attack is just one of many more in the planning stages, then my company will cancel travel to France until strategic modifications to travel policy are considered.

15% Very likely

15% Somewhat likely

55% Somewhat unlikely

15% Very unlikely

If the attack is just one of many more in the planning stages, then my company will cancel travel to to/within Europe until strategic modifications to travel policy are considered.

10% Very likely

25% Somewhat likely

50% Somewhat unlikely

15% Very unlikely

Our company’s Duty of Care policy will drive any modification to travel policy.

0%   Strongly Disagree

20% Disagree

25% Unsure

50% Agree

5%   Strongly Agree

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