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Here’s Why Your Boss May Reject Your Business Travel Request

People are taking vacations again, but a once dominant travel sector is struggling to recover.

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1 year ago

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People are taking vacations again, but a once dominant travel sector is struggling to recover.

Now that vaccines are readily available and President Joe Biden has declared that the pandemic is officially over, people are flying again. But they’re really not happy about it.

The research firm J.D. Power found that last year, when the airline industry first started to cautiously rebound, consumer satisfaction with airports reached an all-time high. But this was very likely both because of a relatively smaller sample size and that so many people were happy to fly again that they were willing to overlook a lot of what has become headache-inducing about modern airfare travel.

J.D. Power  (JD) - Get JD.com Inc. Report has found that this year, global passenger levels are nearly back up to 91% of pre-pandemic levels. 

Customer satisfaction has dropped sharply, 25 points on a 1,000-point scale, to 777, as more people have returned to airports, for reasons ranging from an increase in flight cancellations and delays to inflation-driven increases in the cost of airport food.

But while airlines are aware that customers aren’t happy, and that the Biden Administration might try to right the ship with proposals that airlines likely won’t care for, at least people are flying again.

But an additional survey by J.D. Power has revealed that while people are flying again, traveling for business (be it for in-person meetings or industry conferences), has been lagging behind and recovering at nearly the rate of traveling for pleasure. 

Is Traveling for Business on the Way Out?

J.D. Power’s research has found that many travelers doubt that travel levels will increase dramatically from where they are now, and that “a strong majority of executives believe their companies will spend less in the next six months compared to the same period in 2019, for instance, due to things like fewer trips overall or fewer employees sent when there is a trip scheduled,” according to their data.

Overall, business travel has returned to “about 81% of 2019 levels,” notes Managing Director Michael Taylor. “83% was our prediction for this quarter, we’ll see how well we did in a few weeks and add a predication for Q4.”

J.D. Power

Fears of recession and the rising costs of air tickets from inflation play a factor in the decline of business travel. But overall, the main reason is that many of us have gotten so used to working at home that two-thirds of employees would rather find a new job than go back to the pre-pandemic status quo. If employees feel they can get work done from home and don’t feel like braving traffic to return to the office, why would they feel they need to get on a plane?

So have services like Zoom (ZM) - Get Zoom Video Communications Inc. Report and Slack made the business trip redundant? Taylor has his doubts.

“But will people be meeting exclusively in the 'Metaverse' rather than in person? I do not think that will happen,” he says. “There is too much information to be gathered in face-to-face meetings, spoken and unspoken, to be replaced completely by virtual ‘reality.’”

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So is This It for Business Travel?

Back in the heady pre-pandemic days three years ago, airlines could rely on the extra income from people whose jobs entailed a great deal of travel, and who had come to the realization that if they were going to spend a chunk of their lives on the road, they could splurge to make it a more comfortable experience. 

But if airlines want this sector to return, Taylor thinks it’s their duty to make it a more appealing option, because frequent delays and other headaches are enough to make anyone stick to Zoom.

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Airlines, Taylor says, must “create more of a “living room” experience for travelers, one that “makes travelers feel valued as patrons of the airlines, and makes people feel like individuals rather than cattle.”

Because while it’s hard to argue with the convenience, Taylor insists there is still something to be said for the occasional in-person meeting. 

“Millenia of evolution in mankind has created an awareness that can’t be described with words on a page or pixels on a screen,” he says. “People will still find advantages in meeting in-person rather than online.”

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This new McDonald’s China menu item is a meat lover’s dream

The fast-food giant has delivered a new sandwich, and you might want to ask your doctor about it before you eat it.

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25 mins ago

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October 14, 2023

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While the Big Mac has the word "big" in it, McDonald's hasn't really staked a major claim as the fast-food chain for people looking for the meatiest sandwiches.

Arguably, at least in the U.S., Burger King and Wendy's (WEN) - Get Free Report have stronger claims to that dubious title. 

Wendy's, for example, has the Dave's Triple and the Big Bacon Classic Triple on its menu while it also lets customers order a burger with a total of four hamburger patties if they so choose.

The menu at Restaurant Brands International's  (QSR) - Get Free Report Burger King features a Triple Whopper, which actually contains fewer calories (1,170) than the two-patty Bacon King. Burger King will also sell you a four-patty burger, but you have to make that order in person, not through the chain's app or website.

Wendy's does not appear to limit how many patties you can add to your sandwich, at least when you order through Uber Eats. In theory, if you want 25, or maybe 50, burger patties on your Baconator, the chain will allow it — although at some point wrapping the burger will become a problem.

For its part, McDonald's features a triple cheeseburger on its regular menu, but that's made from three regular-size (1.6-ounce or 45-gram) patties. The biggest item by meat weight is the Double Quarter Pounder, which offers a full half-pound of beef. 

Like its rivals, MCD (probably) will sell you more burger patties if you ask at its counter. It allows extra patty sales through its app on some sandwiches, but not others. The chain also maxes out at three patties (although customers could likely order more in-person as there does not appear to be a policy preventing that). 

All these burgers, however, pale in comparison to a massive sandwich the chain has been selling in China.

A regular Big Mac seems modest compared to some hamburgers.

Image source: Cate Gillon/Getty Images

McDonald's builds a bigger Mac

McDonald's locations around the world — especially in Japan and China — seem to equate the American brand with massive burgers. A new burger from the chain's locations in China sets a new standard when it comes to massive sandwiches, although the burger patties do get some help/

"McDonald's China's Bu Su Zhi Ba Double Layer Beef Burger is a mouthful of meat that puts U.S. patties to shame. True to its name, which translates to German Sausage Double Beef Burger, this item packs two burger patties and two sausages between its buns. This gives customers a protein-heavy dish, with little more than a layer of mustard to round it out — it doesn't contain any of the more traditional McDonald's toppings like lettuce, tomato, or pickles," Mashed shared.

The fast-food giant has never offered sausages in its U.S. restaurants and it has only sold hot dogs on a very limited basis in the U.S. McDonald's founder was famously against the chain selling hot dogs because people would not know what was inside them.

China shows McDonald's the way

McDonald's CEO Chris Kempczinski actually visited some of his chain's locations in China this year. He talked about what he learned during the company's second-quarter earnings call.

"Visiting China truly brought to life the power of a highly digitized economy and our potential for global growth moving forward. With about 90% of our business currently coming through digital channels in that market, it was remarkable to see how the market has forged digital relationships with customers," he said.

Kempczinski was also impressed with other aspects of the company's operations in China.

"China is also making tremendous progress in running the restaurants more efficiently, all with the use of data and technology. This will provide great learnings for the rest of our system," he added.

The chain is also innovating in the delivery space in the market.

"Another recent example of innovation I was able to see firsthand during my visit to China is the use of food lockers at busy locations with high in-store traffic. Upon arrival, delivery couriers can quickly unlock the designated locker and grab the customer's order without even entering the restaurant, removing friction for both the kitchen and the courier," Kempczinski said.

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Coca-Cola surprisingly ending most sales of Aha sparkling water

The beverage giant has decided to mostly walk away from one of its biggest bets in recent years.

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25 mins ago

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October 14, 2023

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Coca-Cola sells some of the most popular beverages in the world and it generally has the muscle to make any new products it sells successful. 

Of course, there have been some pretty big Coca-Cola (KO) - Get Free Report failures in recent years where the company has tried to capitalize on a trend. Few people remember Vault, an effort to compete with rival PepsiCo's (PEP) - Get Free Report Mountain Dew. And 2009's Green Tea Coke never got enough attention to be remembered or forgotten.

Related: Coca-Cola adds new Coke and Sprite flavors that could be big hits

The company's biggest recent failure, however, might be Coca-Cola Energy, an attempt to take on Monster and Red Bull. That drink lasted less than a year before the company pulled the plug.

It was a surprising move because the idea of Coca-Cola Energy made sense. It was an attempt by the No. 1 beverage company to leverage its namesake brand to get into the exploding energy-drink market.

Consumers, however, were never that interested. They may have sampled it, but the product was never popular enough to win enough market share for Coke to commit to the product long term.

That same script has repeated in another explosively growing market. Coca-Cola launched its Aha sparkling-water brand to compete with market leaders LaCroix and Pepsi's Bubly. It was a massive launch — Coca-Cola's first brand debut since 2006 — that simply never captured the public's attention.

Coca-Cola has had some high-profile failures.

Image source: Shutterstock

Coca-Cola is largely winding down Aha        

Sparkling water has been a growing category led by the massive success of LaCroix. It makes sense that Coca-Cola wanted to get in on the trend, but Aha has not made a significant market impact. The company thus has decided to wind down, but not fully eliminate, the brand. 

"In 2024, the beverages will only be available in 'focused channels' and in Coca-Cola Freestyle machines, and will continue to be sold in Canada," the beverage giant told Food Dive.

Coca-Cola isn't giving up on sparkling water. The company intends to focus its attention on growing its premium Topo Chico brand in the same space. 

Sales have fallen for Aha, which replaced Coca-Cola's previous effort in the sparkling-water space, Dasani Sparkling. The brand has less than a 2% share of the total market.

Coca-Cola executives have said that they believe Topo Chico can become the company's next billion-dollar brand. The company recently launched a hard-seltzer, an alcoholic version of the popular brand. 

Coca-Cola sees some headwinds

Coca-Cola sales were flat by volume in the second quarter. Chief Executive James Quincey explained why in the company's Q2-earnings call.

"We have seen some willingness to switch to private-label brands in certain categories," he said. "Across the sector, consumers are increasingly cost-conscious. They're looking for value and stocking up on items on sale." 

Quincey believes that Coca-Cola is well-positioned to handle the current market.

"Our pricing is largely in place and is expected to moderate as we cycle pricing initiatives from the prior year. It's more important than ever to be consumer-centric and to partner with customers to provide affordable and premium propositions, which deliver value through basket and incidence growth," he added.

And, while the company has been focused on growing sales outside soda, its namesake beverage continues to be a major driver.

"During the quarter, we gained volume and value share by linking Coca-Cola to consumption occasions and engaging consumers through local experiences. A great example is our Recipe for Magic, which was activated in more than 50 markets and celebrates consuming Coca-Cola with meals," he said.

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Volkswagen EV Sales In China Surge 90%, Despite Overall Sales Slumping

Volkswagen EV Sales In China Surge 90%, Despite Overall Sales Slumping

In the third quarter, Volkswagen AG saw a robust increase in sales…

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1 hour ago

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October 14, 2023

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Volkswagen EV Sales In China Surge 90%, Despite Overall Sales Slumping

In the third quarter, Volkswagen AG saw a robust increase in sales in Europe and North America, which helped counterbalance a decline in the Chinese market.

The automaker saw its Chinese deliveries fall 5.8% during Q3, according to a Friday morning wrap-up by Bloomberg. But global deliveries rose by 7.4%, amounting to 2.34 million vehicles delivered for Volkswagen. Specifically, sales surged 9.9% worldwide in the month of September alone.

In China, the company faced a slump as third-quarter deliveries dipped to 837,200, and September sales experienced a slight decline of 0.9%.

Despite the decline in China, EV sales continue to be robust in the country. The delivery of all-electric vehicles in China surged by an impressive 90% to 21,662 vehicles in September, largely propelled by ID.3 sales, which outstripped overall market gains of 12%.

Meanwhile, Western Europe witnessed a significant 21% uptick in sales to 799,300 during the third quarter, and North American sales climbed 12% to 257,400.

We noted in late September that competition was so robust in China, some automakers like Mitsubishi were pulling out of the geography. Back in early summer, Volkswagen had slowed its production of EVs due to weakening sales. 

"We are experiencing strong customer reluctance in the electric vehicle sector," Manfred Wulff, head of the works council for Volkswagen's Emden plant said in June. That appears to no longer be the case - at least in China. 

We noted last week that the EV market in China is growing so quickly and prices are plunging at such a rapid rate, that the EU is investigating, claiming that emerging data indicates a probable surge in government-backed, low-cost imports, putting an already fragile EU sector at immediate risk.

The EU has launched an inquiry focused specifically on newly produced electric vehicles intended for carrying nine or fewer passengers; motorcycles, however, are not part of the current probe and the investigation is expected to wrap up within a year.

China's Ministry of Commerce objected to the investigation, claiming it "is solely based on assumption and lacks sufficient evidence," Bloomberg reported last week.

We noted weeks ago that Tesla's EVs would be included in the investigation. EU executive vice-president Valdis Dombrovskis said in late September that there was “sufficient prima facie evidence” to support the probe. We had previously written about the EU's investigation and Beijing's response via The Global Times. 

As we noted last month, China responded to the investigation via The Global Times, claiming that the EU's probe would likely "backfire" and that the EU's economy would suffer as a result. The publication said that "...as the EU wields trade protectionist measures to suppress China's EV industry, the European economy may suffer."

The article claimed that the EU isn't bothered by the subsidies, but rather "the rapidly growing market influence of Chinese EV companies" and "the concern that homegrown European enterprises may be unable to compete."

"Clearly, Europe is afraid," The Global Times wrote. "They are afraid of competition from China, so they want to seek trade protectionism as a protective umbrella for European auto makers who are slowly transitioning toward electrification." China added that the EU should "have enough courage to face competition from their Chinese counterparts directly."

Tyler Durden Sat, 10/14/2023 - 07:35

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