Business travel was recovering gradually post-pandemic, with the Global Business Travel Association (GBTA) forecasting a rise to $1.64 trillion by 2025. However, uncertainty stemming from the U.S. trade war has dampened those prospects. According to a GBTA survey, approximately 29% of corporate travel managers anticipate a decline in business travel this year, potentially reducing trips by up to 22%.
Industry experts noted that while expectations are low, bookings have not plummeted. Jonathan Kletzel from PwC emphasized that, despite constraints, businesses recognize the importance of in-person client engagements to remain competitive. Delta Air Lines’ CEO highlighted the need to temper financial expectations, attributing a slowdown in travel demand—initially growing at 10%—to companies reassessing business trips amid workforce cuts.
Hotel chains and travel platforms are also feeling the impact, with Expedia reporting a decline in travel demand. Major hotel chains like Marriott and Hilton have revised their forecasts downward, anticipating a continued decrease in government-related travel.
The Trump administration’s cuts to the federal workforce have added to the demand drop, particularly for government contractors, with a 20% sales decline noted by Global Travel Associates. Many clients have shifted to refundable travel options or canceled plans entirely.
While individual business travel has softened, Jan Freitag from CoStar noted that meetings are still occurring, but could further decline if costs rise due to tariffs. Navan reported a slight uptick in bookings, indicative of companies adapting to rising costs. Anxiety among travelers is evident, with an increase in searches for travel insurance that covers cancellations for work-related reasons. Overall, the travel outlook remains uncertain, with the possibility of considerable slowdowns across both business and leisure sectors.
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