Different industry verticals will restart business travel at different velocities. According to a McKinsey & Company analysis, that will mean a slower recovery for Europe and the United States than for China.
Comparing business travel spending data in China for March 2020 to March 2019, the consultancy identified “early rebounder” sectors. They included construction, food and beverage, forest and furniture, machinery and equipment, and pharmaceuticals. The “longer-term disrupted” sectors included science and technology research, electronics, transportation and warehousing, leasing and commercial services, and utilities.
The IT, finance, oils/chemicals/plastic and real estate verticals landed between.
“If China’s still-nascent recovery is indicative of how sectors will return to travel, then other regions will probably see a slower return, based on their industrial mix,” according to the McKinsey report. “Europe and the United States have a higher proportion of business travel spend concentrated in professional and service sectors and less in the industrial sectors that are showing early resilience in China.”
Based on 2018 business travel spending data, early rebounders accounted for 66 percent of China’s total business travel volume. Longer-term disrupteds contributed 22 percent. By contrast, U.S. data showed 25 percent and 43 percent, respectively. Figures for France, Germany, Italy and the United Kingdom were much closer to those of the United States than China’s.
McKinsey also interviewed travel managers. It found business travel would recover fastest at manufacturing, pharma and construction companies. Travel managers at healthcare, education and professional services firms expected the slowest recovery.
Asked what would make them confident to book business travel, 75 percent of 56 U.S. travel planners indicated a readily available vaccine. That was followed by few or no new Covid-19 cased in the United States for at least a month and readily available testing (each 39 percent).
Related
• Plumbers And Priests? Farmers And Hunters? Profession Ponders ‘Essential’ Business Travel
• The U.S. Lifted Its Advisory Against Traveling Abroad. What Does That Mean?
• Corporate Travel Sentiments Deteriorate
• WorldAware Analysis: ‘Normal’ Is Most Likely 12 To 18 Months Away, And Don’t Look For Indications From China
