Business travel was recovering from the pandemic, with expectations for increased global spending, but the U.S. trade war has introduced significant uncertainty. Suzanne Neufang, CEO of the Global Business Travel Association (GBTA), noted that while spending was projected to rise from $1.48 trillion in 2024 to $1.64 trillion in 2025, pessimism has surged due to government actions, leading 29% of corporate travel managers to anticipate a decline in business travel this year. The GBTA survey warned that business trips could drop by up to 22%.
Industry experts like Jonathan Kletzel from PwC maintain that while travel demand is constrained, it hasn’t collapsed entirely, as companies recognize the importance of meeting clients in person to remain competitive. However, Delta Airlines and other carriers observed a slowdown in travel demand, prompting adjustments in growth plans amid changing corporate travel policies.
Hotel chains and booking platforms, including Expedia, Marriott, and Hilton, have reported declining demand, particularly from government clients due to staff cuts and reductions in federal spending initiated by the Trump administration. Global Travel Associates, servicing government contractors, experienced a 20% sales decline, with many clients curtailing travel plans.
Despite individual business travel being softer, firm bookings were reported at the beginning of the year. However, increasing tariffs may lead companies to further cut costs by reducing travel expenses. Additionally, a rise in searches for flexible travel insurance suggests growing anxiety among travelers.
Overall, the outlook for business travel remains uncertain, with experts suggesting a cautious “wait-and-see” approach, anticipating that economic pressures will increasingly affect travel decisions in 2025.
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