By Esther Teo

IT HAS been a lean year for executives used to jetting about the world at their companies' expense, but business travel looks set to take off again.

Seats at the front of the plane are starting to fill up again as bosses loosen the purse strings to let their road warriors spend more face time with overseas contacts.

A turnaround is long overdue. Business travel plunged by 18 per cent in the first 10 months of last year, compared with the figure in the same period in 2008, according to the International Air Transport Association (Iata).

The number of passengers travelling on first or business class last November was 6.7 per cent lower than that in the same month of 2008, but that was better than in October, which was down 9.3 per cent year-on-year, said Iata.

'A stronger rise in world trade in recent months appears to be associated with a modest rise in business travel,' it said in its report on premium travel released in December.

Premium travel in November was up 18.2 per cent year-on-year within Latin America and up 13.7per cent between the Middle East and Far East, although it was still down 18.5 per cent within Europe and down 5.9 per cent on the transatlantic market, Reuters said last month.

A survey found that business travel this year will match or surpass last year's levels, and more executives will be opting for first-class seats.

The poll of 227 travel experts showed that nearly 40per cent expected booking levels to be similar to last year's, while 28per cent forecast they would be better. Only 12 predicted that bookings would decrease, said Reuters.

Mr Dhirendra Shantilal, senior vice-president (Asia-Pacific) at human resource solutions firm Kelly Services, said the improving economy was prompting more firms to increase business trips.

Singapore Airlines (SIA), which derives about 40per cent of its revenue from premium classes, had been particularly badly hit by the fall-off in business travel. It introduced a slew of measures to mitigate the impact of the crisis, including a network-wide capacity cut, and retiring or grounding older aircraft.

But there are now positive signs of a recovery and the airline has just restored the frequency of one of its all-business-class flights to Newark, near New York, which had been reduced due to falling demand. On Jan19, the Newark route reverted to daily operations, from the five-times-a-week service imposed in the crisis.

Frequency to Mumbai and Delhi will also be increased from next month and June respectively. Flights will be operated twice daily to both cities, up from the 11 times a week now, with Munich being introduced as a new destination next month.

SIA chief executive Chew Choon Seng noted in December that 'bankers in suits' are filling up the airline's business-class seats.

A number of other Asian airlines, including Cathay Pacific, have seen signs of a recovery in air travel, including in the premium segment, Reuters said last month.

Cathay Pacific chief Tony Tyler said that since the beginning of the fourth quarter last year, the airline has seen premium passenger travel and cargo demand start to recover. 'And we're still seeing some fairly good signs in the first quarter of this year,' he told the New York Times (NYT) last week.

Asian carriers, in particular, are well positioned to benefit as growth in Asia and China, in particular, accelerates more sharply than in any other region in the world, Hong Kong-based HSBC analyst Mark Webb told NYT.

With these tentative signs of recovery, companies are also looking to review the strict travel policies imposed during the crisis.

Maybank Singapore's head of human resource, Mr Wong Keng Fye, said that before the financial crisis, only certain levels of staff were permitted to fly business class, and that also depended on the travel distance. When the crisis hit, it restricted all business travel to economy class for all staff.

Maybank is now reviewing the need to continue with the restrictions, said Mr Wong.

Technological advancements have also made it easier to communicate with foreign partners through other cost-effective alternatives, such as video and Web conferencing.

OCBC Bank said that while its employees continued to travel when necessary during the financial crisis, it also employed conferencing technologies. This was also in line with its efforts to protect the environment by minimising travel, it said.

The financial crisis has forced companies to look more at what these business trips can achieve. 'Many firms continue to manage their costs by travelling on business-related activities that add to the organisation's value chain and bottom line,' Mr Shantilal said.

These firms remain cautious, demonstrating that recovery remains slow, with premium travel numbers still over 20 per cent lower than figures in early 2008.

Mr Chris Jock from Kelly Outsourcing and Consulting Group said his firm has a conservative business travel reimbursement policy, with employees encouraged to seek out the most cost-effective

travel. This was emphasised even more with the financial crisis.

'We have seen added levels of approvals needed to help tie travel cost to tangible business results and outcomes. These were not limited to just business-class flights,' he said, adding that these stricter guidelines will remain.

This article was first published in The Straits Times.