BOSTON — Half of corporate travel policies now allow employees to use transportation network companies (TNCs), according to the latest Global Business Travel Association (GBTA) Business Traveler Sentiment Index.
Overall, TNCs have nine million users and raked in $3.3 billion in 2015. They are projected to grow to $6.5 billion in 2020 — much of that growth is expected to come from business travelers in North America, according to the GBTA report.
Those disquieting numbers for limousine operators landed just a few months before the annual GBTA Convention set for July 16-20 in Boston where 30-plus limousine companies are expected to exhibit.
Uber now accounts for 53% of business travelers’ transportation receipts and tops the list of most-expended brands, according to Q1 2017 Certify’s Business Travel Ground Transportation Report.
Of course, TNCs are not profitable, and Uber has come under fire for how it does business. Reports of a harassment culture, low driver pay, and criminal acts against passengers by poorly background checked drivers abound in the news media.
“There is no question the sharing economy will continue to alter how business travel is conducted,” GBTA executive director and CEO Mike McCormick told LCT. “With the sharing economy rapidly changing the travel landscape, there are a number of considerations individual business travelers as well as corporate travel departments need to account for when approving use of sharing-economy options. Personal liability, security, or broader duty-of-care concerns top the list.”
McCormick explained business travelers and travel buyers “must be aware of these changes, their benefits and drawbacks, and consider all scenarios when updating, incorporating, sharing, and following a corporate travel policy.”
One of the problems in the corporate sector is employees do not know if their travel polices address TNCs.
“The sharing economy trends that have come to define personal travel are significantly influencing business travel as well,” said Susan Chapman Hughes, senior vice president of American Express Global Commercial Payments, in the index report. “However, nearly one in five travelers are still unsure whether their employer’s policies allow for sharing-economy services, making it especially important for companies to communicate clear details about the services and amenities their policy covers,” said Hughes, quoted in the GBTA index report.
“We believe TNCs must meet the proper standards of duty of care systematically across the board and globally. We are pushing the message to elevate duty of care by requiring TNCs have full FBI database background checks, because the downside is if employees get injured in a TNC or are a victim of a crime, there is a liability and they can be held responsible,” said Solombrino, who also is President of the GBTA Allied Leadership Council.
In 2016, fewer business travelers reported being required to follow a company travel policy — 44% compared to 50% in 2015, according to the GBTA Business Traveler Sentiment Index. Another 21% don’t have any travel policy restrictions versus 15% in 2015.
The index noted looser requirements could help explain why six in 10 business travelers say they are satisfied with their companies’ travel policies compared to 54% in 2015. And it’s not just about TNCs; the index reports 28% of companies allow employees to use homesharing services such as Airbnb or HomeAway.
GBTA Notes TNC Risks
Concerned corporate travel managers are not fully aware of the risks of allowing employees to use TNCs. The GBTA has alerted members of the following issues:
Business practices: TNCs certainly have room to grow and mature. Discriminatory, exploitative, and predatory business practices will not serve it well with corporations. However, TNCs have added some slick services around driver and vehicle identification, route planning, and car-tracking services that can help companies ensure passenger safety.
Insurance: Debate still exists whether insurance coverage for TNC drivers has been sorted out with regard to their passengers. Several of the larger TNCs’ company-provided insurance works while the app is on; supplemental insurance is sometimes offered by many major carriers, including Geico. There hasn’t been a real litmus test court case around the duty-of-care concerns with corporate travel policies and their incorporation of TNCs.
Safety/security: While violent incidents involving TNCs attract headlines, in sum these services appear to be at least as safe as taxis, especially in foreign countries.
The GBTA Convention will host a session addressing the pros and cons of TNCs on Wednesday, July 19. “To Ride or Not to Ride? Can Corporate Travel Programs Go Global and Stay Safe with Shared Economy Ground Transport Services?” will include four panelists representing various sides of the debate, including Tim Rose, CEO of North America Addison Lee Global.
Business Travel Growth Uncertain
The U.S. is projected to lose $1.3 billion in travel-related expenditures in 2017 due to the Trump administration’s travel ban, as well as the Department of Homeland Security barring passengers traveling from 10 airports in eight Middle Eastern and African countries from bringing laptops and large electronics into the cabin as carry-ons, according to the GBTA.
“Business travel remains strong despite ongoing geopolitical disruption,” said Mike McCormick, GBTA executive director & CEO. “Global business travel spending last year was forecast to hit $1.3 trillion and will reach $1.6 trillion by 2020. Our latest U.S. Business Travel Outlook, which was completed after the election, but before President Trump took office, projects a 4.4% increase in business travel spending in 2017 totaling $296.1 billion, following a 0.2% drop in 2016, he added.
However, McCormick pointed out projected growth is “very much in jeopardy due to policies from the Trump Administration creating uncertainty around travel.”
Business travel drives lasting business growth and is a leading indicator for jobs and the economy at large, he said. “Continuing to enact policies that discourage business travel will cause a rippling effect across the travel industry and the overall economy. We urge the Trump Administration to consider the important lasting impact of business travel and enact policies going forward that preserve both our national security AND our economy for the future.”
Keywords
business travel corporate travel GBTA Global Business Travel Association industry trends research and trends
Follow @lctmag on Twitter
via Limo News http://ift.tt/2sJ1mCt
CINCINNATI, Ohio — Built by 
ORLANDO, fla. — In less than four months since it formed, the new 
