More corporates flying LCCs

Companies' continued quest to keep travel costs down has resulted in a greater adoption of budget flights among business travellers.

A Carlson Wagonlit Travel (CWT) report this year indicated that business travellers would increasingly use LCCs in 2013, with 34 per cent of travel managers in Asia-Pacific looking to budget airlines to optimise savings.

Nandan Bhatia, head of Britannia Industries India, said: “According to our company’s policy, we have to book (seats with) the lowest possible fare, so we have to look at LCCs.”

Abhimanya Chettri, manager of Robert Bosch Engineering and Business Solutions India, said: “We have been using LCCs because their prices can be 30 to 40 per cent lower (than full-service airlines).”

Fred Seow, vice president for marketing of Asiatravel, said: “Sometimes the total difference in fares can be quite significant and LCCs today also ply the same routes as legacy carriers. Meetings and incentives today are held by organisations of all sizes, types and budgets.”

Nonetheless, the CWT report highlighted that companies need to consider numerous factors, such as less frequent flight schedules, flights operating from secondary airports, as well as the costs and risks related to bookings outside of GDSs.

Akbar A Shareef, managing director and chief executive of Rakaposhui Tours Pakistan, cited seat availability as his reason for not using LCCs, while Sunil Shekhar Gupta, regional procurement manager of Freescale Semiconductor India, said his company would not use LCCs to fly its VIPs as it does not “look good”.

LCCs’ availability largely outside the GDS platforms is not an issue for Chettri: “We will usually book directly with LCCs, and since we are buying in bulk with them, there are terms and conditions we can negotiate as well.”

An Abacus survey this year has revealed similar findings, with almost three-quarters of respondents seeing more clients adopt budget airlines to tighten corporate travel spend, mostly due to policies governing the choice of lowest fare (77 per cent), but also for alternative flight times (40 per cent) and data capture (40 per cent). To ease the booking process for clients, Abacus is working with LCCs to make all their fares available on its platform.

Meanwhile, AirAsia will be launching a travel programme for business travellers later this week, according to its spokesperson.

-TTG Asia.