Business travellers are opting to fly longer routes to Europe rather than downgrade to economy as airlines avoid Middle East airspace, according to FCM global COO and global MD Melissa Elf.
Speaking to Travel Weekly, Elf said many corporate travellers are maintaining business class travel by rerouting through Asian hubs or even the United States rather than switching cabins as availability tightens.
“Corporates obviously have a business class policy, and we are seeing people go by different directions rather than downgrade,” she said.
“We are seeing a huge amount of customers reroute through either Singapore or other Asian hubs. We’ve even had some extremes through the USA, which is more a reflection on availability at the moment.”
The shift comes as airlines adjust schedules and routes amid escalating tensions in the Middle East, which has disrupted one of aviation’s key corridors between Australia and Europe.
Despite the disruption, Elf said corporate travel demand has remained resilient so far.
“We’ve actually seen corporates divert their travel through alternate routes as opposed to cancelling travel at this stage,” she said.
“In our numbers we’re definitely not really seeing an impact in terms of decline in volume.”
Premium cabin shortage
Availability has become the main challenge, particularly in premium cabins where most corporate travellers sit.
“It’s pretty tough in the next month or so getting availability through to Europe, particularly at the pointy end where corporate customers travel,” Elf said.
While many companies are temporarily avoiding transit through the Middle East, Elf said corporate travel policies themselves have not changed significantly, with safety considerations driving route changes rather than travel reductions.
Flight Centre Group also has a presence in the region, with around 200 staff based in Dubai across its businesses including FCM and TPConnects.
Elf said the company is maintaining regular contact with its teams there while prioritising their safety and wellbeing.
“The guys are working from home at the moment. Their safety and wellbeing is our priority,” she said.
Keeping business moving
Despite the current disruption, Elf said she does not believe Australians will be permanently deterred from travelling through the Middle East.
“I honestly don’t think it will,” she said. “I think once things settle down and this is resolved, it may take a little bit for corporates to start going back there, but it will bounce back.”
For now, Elf said companies remain focused on keeping business moving.
“At the end of the day corporates need to travel. They need to travel to grow their businesses and meet with their own people and customers.”
Flight Centre Travel Group has been doubling down on business travel, with its corporate division now accounting for 51 per cent of total transaction value, overtaking leisure as the company’s largest segment.
Results: Flight Centre bets big on business as corporate becomes largest contributor to TTV
