City banks reveal plans to slash business travel by half after Covid pandemic in fresh blow for airline and hospitality industries
- Banking giants planning to cut down on business travel in the wake of pandemic
- HSBC, Lloyds Banking Group and ABN Amro all plans to shrink carbon footprint
- But the news will come as yet another blow to the beleaguered travel industry
Banking giants are planning to cut down on business travel in the wake of the Covid pandemic, it emerged today.
HSBC, Lloyds Banking Group and ABN Amro have all announced plans to cut back on international flights in a bid to shrink their carbon footprint and cut costs.
But the news comes as a fresh blow to the beleaguered travel industry, which has been left on its knees in the coronavirus crisis and relies on business travel to bolster profits.
Carriers are forecast to lose around £34 billion in 2021, according to the International Air Transport Association.
Businesses spend more than £215 billion each year on corporate travel, approximately 20 per cent of which is on airfare, PwC figures suggest.
For airlines, corporate travelers represent 12 per cent of passengers and generate billions in revenue — as much as 75 per cent of profit.
Chief executive of HSBC Noel Quinn told the Financial Times that he aims to reduce his own travel by about half
ABN Amro aims to halve its air travel compared with 2017 over the next five years, and will ban bankers from taking flights between its European offices, making them travel by train instead
Chief executive of HSBC Noel Quinn told the Financial Times that he aims to reduce his own travel by about half, taking fewer flights to the bank’s international outposts.
According to the Financial Times, ABN Amro aims to halve its air travel compared with 2017 over the next five years, and will ban bankers from taking flights between its European offices, making them travel by train instead.
And Andy Halford, chief financial officer of Standard Chartered, told the FT he expects travel to be around a third lower than before the pandemic.
Major events such as 9/11 and the Great Recession of 2008 affected business travel, but neither crisis had the sudden, sharp impact of COVID-19:
According to a PwC study, almost half of all firms have cancelled all business trips, and more than 90 per cent have suspended all non-essential travel.
This comes after HSBC pledged to shrink its carbon footprint to net zero by 2050.
The bank said it was ‘committed to set out short and medium term transition targets, and to phase out the financing of coal-fired power and thermal coal mining by 2040 globally.’
A spokesperson added: ‘We have an ambition to be net zero by 2030 and to bring our financed emissions to net zero by 2050. We remain committed to supporting our customers in their transition to net zero.’
Lloyd’s Banking Group has also pledged to slash carbon emissions in a bid to meet the UK’s 2050 net-zero target.
As companies stop sending executives abroad for meetings and instead relied on Zoom, airlines, many of which have expanded and updated their business cabins in recent years, slashed their fares at the start of the year to tempt leisure travellers.
Lloyds Banking Group has announced plans to cut back on international flights in a bid to shrink their carbon footprint and cut costs
Travel bosses last week slammed the Government’s approach to resuming international flights, arguing it was ‘too cautious’ and warned many holiday firms were ‘teetering on the brink’.
Senior industry figures told MPs on the Transport Select Committee that the proposed traffic light system is ‘too complex’ while the overall strategy set out by ministers is ‘very vague in many areas’.
They also warned border control at airports is already ‘unable to cope’ with Covid checks despite passenger numbers being massively reduced due to the lockdown ban on non-essential international travel.
They warned there will need to be a ‘dramatic improvement in border performance if we are to increase passenger numbers’ when flights do resume.
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