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Article Excerpt
For the second consecutive year, the total estimated U.S. booked air volume of companies that have the 100 largest travel budgets was below $8 billion in 2003--roughly flat compared with 2002 and well under the year 2000 peak of $11 billion. As reported in this, the 17th annual edition of Business Travel News' Corporate Travel 100, the back and forth of consolidation last year remained the big theme in the corporate travel game.
Consolidation on many fronts, that is. For one, saving money in corporate travel stems largely from consolidating travel spend, and this year's CT100 listing contains more than 80 multinational corporations whose domestic travel spending and management is consolidated with a single entity. As never before, this year's crop seeks to gather together the services and savings promised by multinational travel management. Eighteen of them have consolidated almost all of their worldwide travel management with one supplier.
Another form of consolidation influenced a significant boost in Corporate Travel 100 marketshare commanded by American Express, which eclipsed the 46 percent mark for the first time since 1996, following the 2003 acquisition of Rosenbluth International. No provider dominates like Amex, which does business with more than half of the largest 100 accounts--42 of them as the consolidated U.S. provider.
Acquisitions by the accounts themselves drove a number of travel budgets higher, including those of IBM and Northrop Grumman, but divestitures also made a big mark, with such spinoffs as Bearing Point, Capgemini and Delphi appearing on the list for the first time. Of all the travel management company competitors, Amex benefited most from the addition of 16 corn parties that did not appear on the prior year's list. Snagging seven of these new 16 and, thus far, keeping six of the nine CT100 accounts previously handled by Rosenbluth, the New York mega showed a net gain in 2003 of 12 fully consolidated CT100 accounts.
Winning two of the three that left Rosenbluth--ChevronTexaco and Royal Philips Electronics--helped Carlson Wagonlit Travel close the marketshare gap between itself and World Travel BTI, which in 2001 first surpassed CWT for second place behind Amex. CWT's share rose to 18 percent from 14.2 percent in 2002, while WorldTravel's fell slightly to 19 percent. CWT worked with one fewer consolidated and three more shared accounts than it did in 2002, and the number of WorldTravel's consolidated accounts fell by three to 18 and shared customers dropped by one to two.
Business Travel News tabulated travel agency marketshare by assigning all estimated U.S. booked air volume for a given account to its consolidated U.S. provider. Additional estimates were made on the percentages of non-consolidated volume managed by primary providers.
The following pages benchmark the nation's largest corporate travel management programs in terms of achievements, goals and spending patterns. These listings show how they are consolidating internally by driving, if not mandating, travel policy compliance, implementing travel programs globally and leveraging group and transient purchasing.
Agency Slices Of CT100 Pie
Sea Gate Travel Group 2%
Navigant International 3%
Self-managed/non-consolidated 19%
Carlson Wagonlit Travel 18%
WorldTravel BTI 19%
American Express 46%
Others with 1 percent or less: Azumano Travel,
Short's Travel Service, Travel Management Partners,
Total Travel Management.
Business Travel News' estimate for each travel management
company's composite share of the CT100
Note: Table made from pie chart.
Amex Gets Back To Nearly Half
Changes In Big Three Mega's CT100 Share
Amex CWT WT BTI
1994 46.3 11.5 6.9 *
'95 43.6 22.1 6.7 *
'96 48.2 20.4 6 *
'97 43.1 16.1 7.8 *
'98 43 18.4 7.5
'99 38.4 18.6 12.7
'00 40 21 12
'01 36.8 16 16.7
'02 38.9 14.2 19.9
'03 46 18 19
* WorldTravel Partners plus BTI Americas before their merger
Note: Table made from line graph.
THE CORPORATE TRAVEL 100
COMPANY AIR VOLUME *
1. IBM $364
2. General Electric $290
3. Boeing $221
4. Lockheed Martin $203.5
5. Northrop Grumman $169
6. Johnson & Johnson $165
7. Deloitte $157
8. ExxonMobil $156
9. Accenture $155
10. Pfizer $151.7
11. Siemens $150
12. Citigroup $143
13. World Bank $128
14. Raytheon $127
15. Hewlett-Packard $122
16. Bank of America $109.3
17. Ernst & Young $107
18. Microsoft $102.8
19. Time Warner $102
20. Motorola $101
21. Walt Disney $100.1
22. KPMG $100
23. Procter & Gamble $96
24. PricewaterhouseCoopers $93
25. Viacom $92.5
26. General Motors $88
27. JPMorgan Chase $84.5
28. General Dynamics $80
29. Cisco Systems $75
29. Oracle $75
29. Science Applications International Corp. $75
32. GlaxoSmithKline $74
33. Royal Dutch Shell $73
34. Eli Lilly $70
34. Royal Philips Electronics $70
36. FedEx $69.2
37. AstraZeneca $68
37. DaimlerChrysler $68
37. Morgan Stanley $68
40. Electronic Data Systems $67.2
41. PepsiCo $67
42. Interpublic Group $66.5
43. BP $65
43. Tyco $65
43. United Technologies $65
46. Goldman Sachs $64
47. Capgemini $62
47. Dupont $62
49. Abbott Laboratories $60
49. BearingPoint $60
49. Deutsche Bank $60
49. Honeywell $60
49. Merrill Lynch $60
49. UBS $60
49. Wells Fargo Bank $60
56. Wachovia $58.7
57. Ford $58
58. Novartis $57.1
59. Credit Suisse First Boston $57
60. ChevronTexaco $56
61. Merck $55
62. Computer Sciences Corp. $53.5
63. Verizon $53
64. Altria $52.6
65. International Paper $52
66. Delphi $50
66. Medtronic $50
66. McKinsey & Co. $50
69. Bristol-Myers Squibb $49.2
70. PeopleSoft $48.3
71. Thomson Corp. $48
71. Wyeth $48
73. Dell $47
73. United Nations $47
75. Aon $46
76. Emerson Electric $45
76. Hoffmann-La Roche $45
76. Omnicom $45
79. 3M $44
80. SAP Americas $43
81. BAE Systems North America $42.2
82. Alcoa $42
82. Booz Allen Hamilton $42
84. International Monetary Fund $41
84. United Parcel Service $41
86. Amgen $40
86. Aramark $40
86. AT&T $40
86. General Mills $40
86. Intel $40
86. McKesson $40
92. Bayer AG $39.1
93. News America $39
94. American International Group $38
94. Fidelity $38
94. John Deere $38
97. ConocoPhillips $35
97. Lehman Brothers $35
99. Cendant $34
99. Nestle USA $34
99. Reed Elsevier $34
* All numbers in millions, representing 2003 U.S. booked net
air volume
THE CORPORATE TRAVEL 100 ALPHABETICAL LISTING
RANKING * COMPANY
49. Abbott Laboratories
9. Accenture
82. Alcoa
64. Altria
94. American International Group
86. Amgen
75. Aon
86. Aramark
37. AstraZeneca
86. AT&T
81. BAE Systems North America
16. Bank of America
92. Bayer AG
49. BearingPoint
3. Boeing
82. Booz Allen Hamilton
43. BP
69. Bristol-Myers Squibb
47. Capgemini
99. Cendant
60. ChevronTexaco
29. Cisco Systems
12. Citigroup
62. Computer Sciences Corp.
97. Conocophillips
59. Credit Suisse First Boston
37. DaimlerChrysler
73. Dell
7. Deloitte
66. Delphi
49. Deutsche Bank
47. Dupont
40. Electronic Data Systems
34. Eli Lilly
76. Emerson Electric
17. Ernst & Young
8. ExxonMobil
36. FedEx
94. Fidelity
57. Ford
28. General Dynamics
2. General Electric
86. General Mills
26. General Motors
32. GIaxoSmithKline
46. Goldman Sachs
15. Hewlett-Packard
76. Hoffmann-La Roche
49. Honeywell
1. IBM
86. Intel
84. International Monetary Fund
65. International Paper
42. Interpublic Group
94. John Deere
6. Johnson & Johnson
27. JPMorgan Chase
22. KPMG
97. Lehman Brothers
4. Lockheed Martin
86. McKesson
66. McKinsey & Co.
66. Medtronic
61. Merck
49. Merrill Lynch
18. Microsoft
37. Morgan Stanley
20. Motorola
99. Nestle USA
93. News America
5. Northrop Grumman
58. Novartis
76. Omnicom
29. Oracle
70. PeopleSoft
41. PepsiCo
10. Pfizer
24. PricewaterhouseCoopers
23. Procter & Gamble
14. Raytheon
99. Reed Elsevier
33. Royal Dutch Shell
34. Royal Philips Electronics
80. SAP Americas
29. Science Applications International Corp.
11. Siemens
71. Thomson Corp.
79. 3M
19. Time Warner
43. Tyco
49. DES
73. United Nations
84. United Parcel Service
43. United Technologies
63. Verizon
25. Viacom
56. Wachovia
21. Walt Disney
49. Wells Fargo Bank
13. World Bank
71. Wyeth
* All rankings reflect 2003 U.S. hooked net air volume
CT100 Methology
The 2004 Corporate Travel 100 ranks corporations by 2003 U.S. booked net air volume, as provided by the company or estimated by industry sources and Business Travel News.
Corporate profiles were compiled by editors from phone interviews and questionnaire responses, primarily with corporate travel buyers. More than 70 of the companies on this list filled out the questionnaire, which asked them to list vendors in order of preference.
In cases where companies did not cooperate or to supplement their data, information was gleaned from annual reports, published reports and interviews with industry sources outside of the company. Business Travel News editors gave those companies the opportunity to respond to information gathered from outside sources and public information. Travel volumes and other figures were as of year-end 2003.
THE CORPORATE TRAVEL 100
1 IBM Armonk, N.Y.
U.S. booked net air volume: $354 million Preferred vendors: American; Hertz Consolidated global agency: American Express
IBM, the world's largest computer hardware manufacturer and service provider, also is one of the largest providers of both software and semiconductors. Last year, the company acquired PricewaterhouseCoopers Consulting and several other organizations to augment its software and service businesses, while streamlining its hardware operations with divestitures and organizational shifts. With the PwC unit and the formation of IBM Business Consulting Services, the company generated $3 billion in Business Transformation Outsourcing signings during the fourth quarter of 2003.
IBM had $89 billion in 2003 sales last year, up nearly 10 percent from the previous year. Its 2003 net income was $7.6 billion, up 112 percent from 2002. IBM cut its workforce by 28 percent to 255,157 employees.
The PwC Consulting acquisition helped increase IBM's U.S. booked net air volume significantly last year from $270 million, reclaiming its long-held status as the biggest spender by far after General Electric tied it last year.
Having completed the implementation of Galileo as its global distribution system, IBM last year worked with American Express to drive U.S. adoption of the online booking system that Galileo built specifically for IBM.
2 General Electric Fairfield, Conn.
U.S. booked net air volume: $290 million Companywide booked net air: $400 million Preferred vendors: Hilton; Hertz; Sabre GetThere Consolidated global agency: Carlson Wagonlit Travel
GE continued to build on its "follow-the-sun" travel management philosophy last year as it made full use of its Warsaw, Poland, operation in tandem with its Phoenix fulfillment center and consolidated travel in China to one location. Facilitating that approach is GE's global distribution system relationship with Sabre.
General Electric now uses the Sabre Get There online booking system to book more than 60 percent of its domestic tickets.
GE also has been a pioneer of touchless transactions for years and now fulfills about 90 percent of its transactions without manual intervention.
GE uses an expense reporting system in the United States that it developed internally, but it uses the Concur expense reporting system outside of the United States and now is seeking to deploy that tool globally.
The priority for the travel department now is to facilitate the integration of recent acquisitions Amersham and Universal.
The company, which uses the GE MasterCard as its corporate card, has 80,000 U.S. cardholders.
Its workforce also grew by 3 percent to 305,000 employees. GE's sales last year grew only slightly over the previous year to $133 billion. Net income grew by 6 percent from 2002 to $15 billion.
General Electric manufactures a multitude of products, including aircraft engines, locomotives and other transportation equipment, household appliances, lighting, electric equipment, nuclear reactors, medical imaging equipment and plastics. Its financial services operations contributed nearly half of the company's sales last year, making GE one of the largest U.S. financial services companies. It also operates the NBC television network.
3 Boeing Chicago, Ill.
U.S. booked net air volume: $221 million Preferred vendors: National, Alamo Consolidated global agency: Boeing Travel Management Co.
The Boeing Co. serves its travelers through its own travel management company, Boeing Travel Management Co., a wholly owned subsidiary that provides services to smaller companies across the country. It increased its overall U.S. booked net air volume by $6 million from 2002, which followed a $13 million decrease from 2001.
In 2003, Boeing increased usage of its Sabre GetThere online booking system to 50 percent of its bookings. It is currently at 60 percent and is aiming for 70 percent adoption by year-end, although it does not mandate usage of the booking tool. It does, however, work through the finance organization and the corporate intranet to make the case to employees for how much online booking usage can drive down costs.
The company mandates the use of GE MasterCard globally and the Gelco expense reporting system in the United States. It has 80,000 cardholders.
The Boeing Co., the world's largest aerospace company and one of the largest defense contractors, vies with Airbus as the largest manufacturer of large commercial jets. Boeing's space operations include communications satellites, Delta rockets, the International Space Station and the Space Shuttle.
Boeing had $50 billion in 2003 sales, down 6.6 percent from 2002. Net income was $718 million, up 46 percent from 2002. The company decreased its workforce by S percent in 2003 to 157,000 employees.
4 Lockheed Martin Bethesda, Md.
U.S. booked net air volume: $203.5 million U.S. T&E: $480 million Preferred vendors: United, American, Delta, US Airways, Northwest; Marriott, Hilton, InterContinental; Avis; Sabre GetThere; IBM Consolidated global agency: Navigant Int'l
Lockheed Martin in the past year strengthened its travel policy to mandate usage of online booking and preferred vendors. The changes represented a cultural shift for the world's largest defense contractor.
Thanks to the mandates, Lockheed Martin by the end of 2003 had driven 67 percent of domestic air bookings through the Sabre GetThere DirectCorporate online booking system, increasing adoption last month to 77 percent. Also by last month, 75 percent of domestic hotel bookings were going through the online booking system. Lockheed's consolidated global agency, Navigant International, provides online fulfillment.
Lockheed Martin also has been working with Navigant on a new system that automatically alerts travelers, after they book through an agent, that online booking is available. The alert notes savings derived from online booking and reminds travelers to use preferred vendors.
Other changes in the past year included a reorganized staff to better support travel commodities, designated travel approvers for each business unit, development of a travel portal and greater encouragement of nonrefundable tickets.
Travelers both inside and outside of the United States use an expense reporting system developed by IBM. The system automatically asks travelers if they executed air and hotel reservations through Navigant. If not, an e-mail is generated to the corporate controller and reimbursement is jeopardized.
Marriott is Lockheed's primary hotel chain, followed by Hilton. Holiday Inn, an InterContinental Hotels Group chain, also is a preferred. The company also negotiates with small, independent properties. Overall, it has reduced the number of properties in the program. Last year, the company conducted numerous reverse online auctions and this spring, thanks to new mandates, increased use of preferred properties from 45 percent last year to above 60 percent.
Lockheed Martin supplies U.S. Bank Visa cards to nearly 83,000 U.S.-based employees. This spring, the company signed on to also use U.S. Bank's Visa meeting card. Lockheed this year formalized its first companywide meetings policy, directing planners to use the GetThere DirectMeetings solution, which links to GetThere DirectCorporate.
Lockheed uses Sabre as its preferred global distribution system, both inside and outside of the United States.
For the remainder of 2004, the company is looking to complete meeting planning consolidation, extend global supplier agreements and transition new acquisitions into the company's travel program.
Lockheed Martin employs 130,000 people worldwide. Total sales in 2003 topped $31 billion.
5 Northrop Grumman Los Angeles
U.S. booked net air volume: $169 million U.S. T&E: $368 million Preferred vendors: United, Delta, American; Marriott, Hilton, InterContinental; Budget, Avis; Sabre GetThere; Concur Consolidated U.S. agency: American Express
Global defense company Northrop Grumman in 2003 reported a significant rise in travel spend. The company this year said its 2002 U.S. booked air volume came in at $100 million, while its 2002 U.S. T&E was $224 million.
Reflecting the boost in spending in 2003, Northrop saw a 52 percent rise in full-year 2003 sales, according to its annual report. Two newly acquired sectors, Mission Systems and Space Technology, were major contributors to its increase in sales, but all of Northrop's other reporting sectors--Electronic Systems, Ships, Information Technology and Integrated Systems--also achieved double-digit sales growth in 2003.
With roughly 120,000 employees and operations in 25 countries, Northrop Grumman has consolidated its U.S. travel operations with American Express, but has not consolidated globally.
American Express also provides Northrop's roughly 53,000 worldwide travelers with their corporate cards.
Northrop Grumman during the past year deployed a corporate meeting planning card, doubled the adoption rate of its Sabre GetThere online booking tool and put greater emphasis on hotel per diems.
There was no increase in staffing levels, but there was more senior management involvement in meeting planning in 2003 than in 2002.
The company also transitioned TRW, which it acquired in 2002, into the corporate travel program and completed the renegotiation of $465 million in supplier agreements.
Regarding policy, the company in 2003 placed parameters around corporate jet usage and this year will enhance usage of restricted and nonrefundable fares.
Northrop this year also will continue renegotiating major supplier agreements and increase adoption of its online booking tool, while focusing on cost-saving initiatives.
Inside of the United States, Northrop Grumman uses the Concur expense reporting system and Sabre as its primary global distribution system.
6 Johnson & Johnson New Brunswick, N.J.
U.S. booked net air volume: $165 million Companywide booked net air: $285 million U.S. T&E: $600 million Companywide T&E: $800 million U.S. booked meetings air: $21 million Preferred vendors: Delta, American, Continental; Marriott, Hilton, Starwood; Avis, National; Alex CTO; IBM Consolidated global agency: American Express
Johnson & Johnson's internal corporate travel operation in 2003 had a smaller staff amid increased senior management involvement with travel purchasing compared with 2002.
American Express CTO is Johnson & Johnson's primary U.S. online booking system. J&J last year required that point-to-point travel be booked via the tool, ramping up online booking from zero to 70 percent in 18 months.
This year, Johnson & Johnson plans on attaining an 80 percent online adoption rate for all transactions, including international and multi-legged domestic bookings.
The company this year also will look at its current travel policy, eyeing first class, business class and car service usage.
Sabre is the company's primary global distribution system inside of the United States, while Amadeus is primary elsewhere.
The company uses the IBM expense reporting system within the United States.
Johnson & Johnson's 36,000 U.S. cardholders carry American Express, while its 54,000 companywide cardholders carry Alex or Visa cards.
7 Deloitte New York
U.S. booked net air volume: $157 million U.S. T&E: $400 million U.S. booked meetings air: $7.4 million Preferred vendors: American, Continental, Delta, Northwest, United; Marriott, Starwood, Hyatt; Avis, Budget; Cendant Travelport Consolidated U.S. agency: WorldTravel BTI
In August, Deloitte Travel Services began reporting to the firm's procurement department. The reorganization that resulted combined the operations of the various travel functions with procurement. Each travel function now has a single point of management that has complete responsibility for both procurement and operations.
Through the transition, the firm's senior management became more involved in voicing support for the program. A goal for 2004 is to increase the use of preferred suppliers, particularly hotel suppliers. Travel managers also are taking steps to improve the level of customer service travelers receive from travel counselors, suppliers, etc.
The firm this year is weighing changes in travel policy to mandate the use of the agency or, for U.S. travelers, the use of the Cendant Travelport booking tool. Travelers from outside of the United States presently do not access an online tool. The firm in 2003 made its first concerted effort among U.S. travelers to improve online adoption, seeing it as a way also to improve use of preferred suppliers.
Changes in travel policy also are being considered that would require use of the lowest available airfare. This would include threatening to not reimburse travelers, a step the firm has not yet taken.
Deloitte's roughly 26,600 U.S. cardholders carry an American Express or Diners Club card. The firm uses Galileo as its GDS for these travelers.
8 ExxonMobil Irving, Texas
U.S. booked net air volume: $156 million Companywide booked net air: $243 million U.S. T&E: $278 million Companywide T&E: $550 million Preferred vendors: Continental, British Airways, Air France; Marriott; National, Hertz; Concur Consolidated U.S. agency: Carlson Wagonlit Travel
ExxonMobil last year completed consolidation with TQ3 Travel Solutions, including a new multilingual call center in Brussels that handles at least nine countries, representing the bulk of the company's European bookings. ExxonMobil had been TQ3's largest client before its U.S. partner, Maritz Corporate Travel, was acquired by Carlson Wagonlit Travel and TQ3 aligned with Navigant International. The company still is sorting out its agency relationships.
In addition to agency consolidation, the energy giant in the past few years slimmed down its supplier portfolio by forging global deals with key airlines and hotels. Aside from Continental, the company also uses American and United in the domestic market. The Amadeus global distribution system is used in Europe, while Sabre serves as the primary GDS throughout the Americas.
In 2003, as senior management became more involved in travel management, ExxonMobil modestly reduced air volume and overall T&E spend, both within the United States and on a worldwide basis. The reductions, in part, stemmed from stricter travel policies, including the elimination of domestic business class travel and international first class travel for all employees except top executives.
ExxonMobil's employees, both inside and out side of the United States, use the American Express charge card. Concur furnishes an expense reporting system for the domestic market.
Moving forward, the company will evaluate an online booking system. It also will turn its travel management focus to operations in South and Central America.
9 Accenture Chicago
U.S. booked net air volume: $155 million Companywide booked net air: $322 million U.S. T&E: $263 million Companywide T&E: $496 million Preferred vendors: United, American, Delta; Marriott, Starwood, Hilton; Hertz, Avis; Carlson Wagonlit Symphonie, KDS Consolidated U.S. agency: Carlson Wagonlit Travel
Accenture's July 2003 transition to Carlson Wagonlit Travel's Symphonie suite of self-booking tools from its internally developed Via Online product proved effective, as domestic online adoption remained about 85 percent. Following traveler input, Accenture's customized version of Symphonie included several cosmetic improvements over the prior technology, allowing the firm to maintain high compliance.
The consulting giant is also the only corporate user of DirectNet, a non-global distribution system booking channel provided to Symphonie users by Accenture subsidiary Navitaire.
Accenture implemented a new hotel initiative designed to advise travelers of the best choice of Accenture's preferred properties in a given location, based on a combination of the rate offered and the property's location.
Though no new policies were created or are planned, a renewed emphasis on ensuring air travelers accept the lowest logical airfare has reduced the number of noncompliant travelers to less than 1.5 percent.
The travel department also reduced headcount, consolidated responsibilities and increased its visibility with senior management. These moves left Accenture's 2003 travel and entertainment expenditures relatively static when compared with 2002, with slight reductions in domestic expenses being offset by international growth.
Several methods of increasing travel management effectiveness were deployed outside of the United States, including the deployment of metrics designed...
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