Agencies cut back on travel
Defense Department employees were once again the top travelers in 2008, spending $9.1 billion on airfare, hotels, rental cars and meals, according to data from the Office of Management and Budget. OMB expects that figure to rise to $9.3 billion in 2009, and then fall to $8.7 billion in 2010, most likely as military operations in Iraq wind down. The Homeland Security Department was the second-biggest spender, devoting $1.3 billion to travel expenses. The Veterans Affairs Department was third, spending $596 million on travel in 2008, and the Justice Department, the third-largest spender in 2007, fell to fourth place in 2008, paying out $406 million.
According to data from the General Services Administration, between 2007 and 2008 agencies experienced a 39 percent drop in cash outlays for travel expenses, from $485 million to $296 million, and a 20.8 percent decrease in spending on hotel rooms, from $2.5 billion to $1.9 billion. Spending on car rentals rose 6.3 percent, from $410 million to $437 million, during the same period. Buoyed by rising airline ticket prices, spending on flights rose 14.2 percent, from $3.5 billion to nearly $4 billion.
There were some big changes at the top of the airline vendors list, however. America West disappeared as a result of its merger with U.S. Airways; the latter's business correspondingly rose sharply. Northwest Airlines saw a 21 percent drop in federal business, from $235 million to $184 million. In the latter part of 2008, the company finalized its merger with Delta, which saw a modest increase in federal business last year.
Meanwhile, purchases on smaller airlines more than doubled.
Spending on car rental companies other than major vendors rose 24 percent in 2008, from $411 million in 2007 to $437 million. Enterprise Rent-A-Car saw a 23 percent rise in business, while Budget had a 12 percent increase. Other vendors saw only minor fluctuations.
There were some changes in the allocation of hotel spending in 2008. Dollars credited to the extended-stay chain AmeriSuites fell dramatically, as new parent company Global Hyatt phased out the brand. Bookings at Wyndham Hotels and Resorts fell 26 percent, from $11.3 million to $8.4 million. The Crowne Plaza Hotels and Resorts saw the largest increase of any hotel chain, with spending there rising from $33.3 million in 2007 to $41.2 million in 2008. Marriott Hotels led chains with $195 million in federal bookings, followed by the Residence Inns by Marriott with $182.2 million, and Holiday Inn Hotels and Resorts with $168 million.Click here for the top travel contractors.