The slump in corporate travel has seen the online travel agency shifting strategy
Corporate travel that slumped after COVID-19 disruption has recovered very little, even after two months of domestic flights resumption, a senior executive from the travel industry said.
"At present, business travel is about 10 to 15 percent of the pre-COVID-19 level," said Dhruv Shringi, Co-Founder & CEO at Yatra.com, during a briefing on July 28. Yatra.com is one of the leading online travel agencies in the country.
Shringi added that much of the travel right now is essential in nature. "It is mostly essential travel that is happening now. Customers are also visiting friends and relatives. But there is no leisure travel at the moment," Shringi said.
Domestic and international flights were suspended in March, to coincide with the national lockdown to limit the spread of the virus. While domestic flights resumed on May 25, the government has allowed international travel to happen through the Vande Bharat Mission repatriation exercise, and air bubbles.
"The recovery in travel is gradual. It may not be a V or W-shaped recovery," said the Yatra.com CEO. Shringi added that capacity utilisation by airlines at present stood at about 15 to 20 percent.
"If one goes by the daily update provided by the Ministry of Civil Aviation, about 60,000 to 70,000 people are travelling a day. This is in comparison to about 4.5 lakh tickets that were sold on an average daily, before COVID-19," Shringi explained.
Fares, consequently, have been 'meaningfully low,' as compared to last year, he said. "Yields are down by 7-8 percent from last year," added Shringi.
Shift is strategy
Yatra gets half of its business from corporate clients. To make up for the steep fall in corporate travel, the online travel agency is shifting gears.
"Yatra is becoming a digital services platform for its corporate clients," said Shringi. Its clientele includes 800 large corporates, 20,000 small and medium enterprises, and over one lakh hotels.
The company has tied up with education portal UpGrad to offer skill development courses for companies. It is also procuring consumables for these companies.
Yatra will also offer digital safety solutions. One of the solutions is Neodot, a bindi-like patch that can be stuck on the body to measure temperature. "This is ideal for places such as malls, hotels and airports that have high footfalls, and one needs to monitor body temperature," Shringi said.
The company is hoping that the shift in strategy will help limit the decline in corporate travel. However, Shringi reiterated that the company has enough cash in its books. "We have $48 million in our balance. This will go a long way as our monthly burn rate is about $1.2 million," he said.