2017 CAPA-ACTE Melbourne Aviation & Corporate Travel Summit – Wrap Up

1 June, 2017

CAPA – Centre for Aviation hosted the 2017 CAPA-ACTE Melbourne Aviation & Corporate Travel Summit this week. The event, which brought together a wide variety of key industry speakers and was attended by suppliers and buyers from all over Australia.

CAPA – Centre for Aviation head of corporate Virginia Fitzpatrick stated:

"My personal anticipation was that if we could just deliver an event that re-established our incredible reputation for excellence with the Melbourne business community then that alone would have been a great outcome". Ms Fitzpatrick continued that: "We had both an exceptional number of delegates attending and the feedback was really unbelievably positive. Whilst the day was definitely all about the travel buyer in the room, all delegates walked away saying 'today I learnt something new and made some great new connections'. That for me is the real measure of success that we were able to reach out to everyone in the room on a very personal level, making them feel very welcomed and that the day out was a great investment".

Key quotes and discussion points from throughout the day:

Big picture Keynotes on the Outlook

NAB senior economist Gerard Burg – State of the Victorian and Australian economy:

  • The global economy remains subdued – is sub-trend the new trend?
  • What we are seeing in the populous is an anti-globalisation trend;
  • Australia has experienced is 26th straight year of economic growth, however the growth is now flat as we move into the second post mining boom phase;
  • Australian economy outlook: There has been a significant change in composition of growth – east coast services rather than west coast miners.

Ord Minnett senior research analyst John O’Shea:

  • There is a massive under investment in the building of new hotels in Australia, with demand outweighing supply, particularly in Sydney and Melbourne;
  • Sydney is expected to witness the highest increase in room rate across Australia with an estimation of 6.8% in the next year.

Aviation Outlook

Air Canada – Airline Keynote: Air Canada general manager Australia/NZ Paul McLean:

  • Air Canada is expanding its international network with the introduction of seasonal Vancouver-Melbourne service. The service will operate four times weekly between 01-Dec-2017 and 04-Feb-2018 with Boeing 787-9 aircraft. Seasonal Melbourne services will provide additional options for business travellers between North America and Australia as well as Australians seeking a Canadian winter vacation experience;
  • VirginAustralia will begin selling codeshare services on Air Canada between Los Angeles and three major Canadian cities, increasing connections between Australia and Canada;
  • Australia is seen as a great opportunity for Air Canada as there is a shared sense of values between the two nations.

Executive Panel: The state of the aviation market

Discussion points:

  • Airline capacity debate: We’ve witnessed huge increases in capacity, but will demand keep up?
  • What’s the outlook for new air capacity and which airline business models will succeed?
  • How are travel patterns and traditional hubs being disrupted?
  • Ultra long-haul: way of the future?
  • Safety/security regulatory developments and their impact on corporate travel

Melbourne Airport executive planning Michael Jarvis:

  • Melbourne airport has a responsibility to ensure infrastructure meets the demand for growth;
  • Constantly changing aircraft technology is impacting infrastructure requirements.

Scoot general manager – Australia Jared Simcox:

  • Low cost carriers afford travellers the flexibility to choose what features are important to them;
  • This flexibility is a key trend for the next three to five years with travellers wanting choice.

Accommodation Outlook

Executive Panel: Rates, occupancy, benchmarking and challenges

Discussion points:

  • The Australian hotel landscape, the capacity outlook
  • What are the external pressures (non-Corporate demand)
  • How do hotels demonstrate value through a Corporate Agreement
  • What are the challenges to the hotel industry when negotiating corporate contracts
  • Overseas corporate travel: a hotelier’s view

Amadeus IT Pacific manager, hotel distribution Benjamin Weinmann:

  • The average global occupancy currently sits at 66%, while Australia, a very mature market, is around 85%.

Accor Hotels regional director of sales and marketing Darren Waite:

  • In the next one to two years, Accor will continue to increase its brands around the world, with a special focus on lifestyle brands.

The Lido Group chief commercial officer Jon West:

  • In the next one to two years ‘on request’ inventory will be eliminated completed in Australia;
  • There is a trend occurring towards meetings and events being made available online;
  • Hotel chains make up approximately 25% of the market, however 75% of corporate bookings are with chains.
  • The best advice we can give any buyer is to negotiate only where you have value and to go to RFP based on future projects, not just previous years.

Carlson Wagonlit Travel senior consultant – CWT Solutions Group Caroline Bisiaux:

  • The best advice we can give any buyer is to engage with their travellers and to allow adequate time to analyse key data.