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Elections around the world — from the U.S. to Australia — may be taking a toll on global travel.
Travelport CEO Gordon Wilson said that uncertainty surrounding elections are leading both leisure and business travelers to postpone trips.
“Some of the negatives are elections,” said Wilson, when asked about major trends affecting travel demand on Travelport’s first quarter earnings call. “It may sound daft, but I’ve been doing this for 25 years now, and the elections tend to sort of suppress travel for whatever reason.”
In the corporate travel space, Wilson is also seeing a similar trend; concerns over weak global growth are leading corporations to constrain or reconsider their business travel spending for the year. The winnowing of the global oil industry has struck a big blow against the positive forces in the corporate travel ecosystem.
“Overall I would probably concur that it’s been fairly flat as a whole in America. It’s also a [global] mixed bag,” said Wilson. “Oil and gas, if you’ve got a big exposure to that, it’s clearly down because that’s a fairly miserable industry to be in at the moment, but other sectors are doing relatively well…. The financial services sector entered into a fairly miserable time in corporate travel that’s beginning to come back as more deal flow happens. So, I’m not particularly gloomy about corporate travel.”
Travelport reported strong overall numbers in international airline ticket sales, which Wilson attributed to a combination of new capacity coming online and relatively low ticket prices for travelers.
“Capacity continues to be added,” said Wilson. “It’s variable around the world, in terms of where the most capacity is coming on. A lot of traffic is coming from low cost airlines. As you know, they’re all progressively embracing third-party distribution that we offer. But there does seem to be a bit of a mismatch of capacity to demand. And the good thing for the airline community is that they can stimulate demand through price when fuel is where it’s at.”