As 2007 comes to an end and NBTA Members prepare for 2008,
Connecting News looked back at headlines and happenings of 2007 to provide readers with a look at the major corporate travel stories of the year.
Passenger Facilitation
Passenger facilitation was a hot topic on Capitol Hill in 2007: As the U.S. government took steps to improve programs that process and screen both domestic and international air travelers, NBTA served as an advisor and advocate, speaking up for the interests of the business travel community.
On January 17, 2007, the U.S. Department of Homeland Security (DHS) unveiled the Traveler Redress Inquiry Program (TRIP), a single online point of inquiry to address watch list misidentification issues -- situations where individuals believe they have faced screening problems at immigration points of entry, or have been unfairly or incorrectly delayed, denied boarding or identified for additional screening at U.S. airports.
DHS TRIP was officially launched in February, and by October it was clear more headway needed to be made. At that point, DHS TRIP had recorded approximately 15,900 inquiries, of which only 7,400 were resolved. NBTA conducted a survey of NBTA Members to gauge their knowledge and experience with the program, finding that 64 percent of respondents were unaware that DHS TRIP existed. In response to these findings, NBTA Executive Director & COO Bill Connors, CTC, addressed the U.S. House of Representatives Committee on Homeland Security to support DHS TRIP and provide suggestions to enhance the program’s success.
In April the U.S. Customs and Border Patrol (CBP) launched the first Model Port of Entry at George Bush Intercontinental Airport (IAH) in Houston, Texas. The Model Ports program seeks to make the process of entering the United States more streamlined, user-friendly and understandable with improved signage, multi-lingual explanatory videos and modernized procedures. The new processes, intended to serve as a prototype for international airports across the United States, were replicated at Washington-Dulles International Airport (IAD) in the Washington, D.C. metropolitan area.
In July President Bush signed the Implementing the Recommendations of the 9/11 Commission Act of 2007, which included, among other important business travel industry provisions, the expansion of the Model Ports of Entry program to the nation’s top 20 international airports. NBTA was quick to encourage members of Congress to include dedicated funding for the program in the 2008 DHS appropriations bill. (See letter to Congress.) A letter was also sent by NBTA to the Honorable Michael Chertoff, urging DHS and CBP to move as aggressively as possible to implement the plan expeditiously. (See letter to Chertoff.) At the time this article was written, Congress had passed an omnibus appropriations bill including the Model Ports funding, and it was awaiting the President’s signature.
NBTA is encouraged by the progress made this year in Washington to employ common sense travel reform measures to strengthen national security as well as improve facilitation processes for thousands of travelers. We look forward to continued progress in the development of programs that ensure the viability of business travel, respect traveler privacy and avoid undue burdens on business.
Green Initiatives
Environmental questions became a major focus in 2007 for many in the travel 
industry, and for media covering the industry, as more companies said they would be “Going Green.”
Hotels not only continued their towel reuse programs, but also added recycling bins and florescent lights to guest rooms. Rental and chauffeured car companies began to promote new hybrid fleets, and meetings management more than ever sought ways to minimize negative environmental affects. Corporations increasingly assessed and responded to the contribution that business travel makes to their overall carbon footprints, and travel departments improved collaboration with corporate social responsibility and environmental officials.
In November the European Parliament approved a proposal to expand the European Union’s Emissions Trading program – a plan to cut carbon dioxide emissions from the 27 EU nations by 20% – to all airlines flying into or out of EU states by 2011. Airlines have been vocal about their opposition to the plan, and the United States has warned of a trade fight should the proposal become law. The EU continues to advance the plan, most recently urging all EU nations to force airlines to cut carbon emissions.
In this high-energy atmosphere, NBTA formed a Corporate Social Responsibility (CSR) Committee. One of the committee’s main areas of focus will be to provide members with resources and best practices information to help them take greater responsibility in minimizing the environmental impact of their business travel programs. At the 2007 NBTA International Convention &Exposition in Boston, the CSR Committee offered education session participants a discussion on what some top business travel companies are doing and how industry professionals can become more corporately responsible. (See presentation handouts.)
The NBTA CSR Committee also worked with the NBTA Hotel Committee this year to update the Modular Hotel RFP with environmental questions to meet industry needs for the 2009 bid season. The changes include the addition of six questions to help travel buyers and hotels reach common understanding of the hotels’ environmental programs. (See Hotel RFP.)
U.S. Air Space Congestion
In the summer of 2007 air travelers in the United States were plagued with record flight delays and cancellations. As airlines, the Bush administration, and the U.S. Congress examined possible solutions to air space congestion problems, NBTA was actively involved throughout the year to ensure business traveler needs were taken into consideration and that the long-term picture was not forgotten.
Much of the public attention was focused on a so-called “passenger bill of rights” and on congestion at New York’s major airports, which can cause a ripple effect of delays and cancellations across the country On December 19, airlines and the government reached an agreement to cap the number of peak-hour flights at two of New York’s busiest airports as of next March. The bill of rights debate continues, with New York State enacting its own law, which is being contested by airlines.
Amid the frenzied attention to these short-term congestion issues, NBTA has worked to ensure that officials and the industry maintain focus on the long-term challenges. An updated air traffic control system is the most important answer to congested skies and accommodating the expected increase in air traffic growth. The Federal Aviation Aministration’s (FAA) proposed next-generation air traffic control system, or NextGen, provided with enough funding, is expected to replace the nation’s outdated radar-powered network with one that relies on GPS and advanced avionics.
In October, NBTA was reappointed to a Board seat on the Next Generation Air Transportation System Institute Management Council, the group that works directly with the Joint Planning and Development Office (JPDO), the multi-agency initiative established to transform the future of the U.S. air transportation system. NBTA is and will continue working closely with the various government agencies of the JPDO to find the right solutions to the complex challenges of a system overhaul.
Open Skies
On April 30, 2007, the United States and the European Union signed an unprecedented air transport agreement that will replace existing bilateral agreements between the United States and EU member states and establish an Open-Skies Plus framework between the United States and all 27 EU member states. The agreement, set to take full effect in March 2008, will allow any European or U.S. airline to fly any route between any city in the EU and any city in the United States.
In light of the new U.S.-EU Open Skies agreement, many anticipate more service options, lower fares and deeper alliance coordination to follow. In fact, four out of five participants in the NBTA UK Corporate Travel Think Tank in September, made up of travel managers and other business travel professionals, agreed that the liberalization of the EU-U.S. aviation market will affect their businesses.
Throughout the year other open skies agreements were discussed and/or signed, including those between the United Arab Emirates and Georgia, Singapore and the UK, and Canada and the EU, among others. The continued liberalization of international air travel markets generally creates more service options and greater competition in those markets, to the benefit of business travel buyers. NBTA served its members throughout the year by keeping them abreast of these important developments so they could effectively manage the changes to the benefit of their companies. We anticipate further open skies developments in 2008 and look forward to continuing to help NBTA members stay informed about these important changes.
Mergers and Acquisitions
Travel Managers across the globe have been keeping a watchful eye on the many industry acquisitions and mergers that occurred in 2007 and may occur in the near future. From rental car companies to hotel chains to airlines, news of major mergers, takeovers and acquisitions have experts preparing for the changing travel industry landscape.
In March, Enterprise Rent-A-Car, the largest rental car company in North America, agreed to buy Vanguard Car Rental Group Inc., which operates the Alamo and National chains. The deal will allow Enterprise to increase its fleet by 42 percent to more than one million vehicles, tremendously boosting its on-airport presence and appeal to the corporate travel market.
In major hotel news this year, Hilton Hotels Corp. accepted a $26 billion acquisition offer from The Blackstone Group. While the acquisition is not expected to increase costs for travel buyers, Blackstone’s global presence may help accelerate Hilton’s plan for international growth.
The airlines industry also saw consolidation excitement, particularly in the second half of this year as the U.S. economy slowed and oil prices spiked. With the industry just having recovered from years of fierce competition and bankruptcies, experts advised that airlines could seek mergers to hold onto profit margins. The M&A developments in the airline business in 2007 are too numerous to list here, so we’ll mention two of particular note. On November 14, the first story broke about the rumored “talks” of a merger between Delta Airlines and United Airlines after a letter disclosed by a New York hedge fund urged the combination. While both airlines denied the rumors, both also reiterated comments in support of mergers, and Delta formed a board committee to study options.
In Europe, low-cost carrier Ryanair and Ireland’s national carrier, Aer Lingus, battled over a possible takeover throughout 2007. Aer Lingus opposed the merger, and, in June, the European Commission (EC) blocked the €1.48 billion bid arguing that it could impact competition in the Irish market. Ryanair is currently pursuing a legal challenge against the EC's ruling.
Global Distribution Systems (GDS) also made consolidation headlines this year when the $1.4 billion acquisition of Worldspan by Travelport was blessed by the EC and finalized. Travelport, which also operates the GDS Galileo, plans to merge the management of both GDSs and is currently reviewing integration opportunities that would benefit customers and partners. 
These and other business travel suppliers sought to better serve the global market by merging. Similarly, the associations representing the industry found ways to better serve members by pooling resources. In April the Australasian Business Travel Association officially merged with NBTA to become NBTA Asia Pacific. The new regional NBTA affiliate continues to serve existing members with Asia Pacific-focused networking, education, resources and advocacy and is now able to tap into the global networking and resources of NBTA. NBTA’s Canadian affiliate also changed its name to NBTA Canada, more clearly aligning itself with the global NBTA brand. At the urging of participants in NBTA’s events in Mexico, NBTA established a regional affiliate in that country - NBTA Mexico.
Return to Connecting News December 2007