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Demand Pictures Softening: Increasing Number Of Cos. Cutting Back Air Travel.

Article Excerpt
The number of corporations scaling back air travel spending this year continues to grow, though many airlines said they have yet to see evidence of a dramatic corporate travel demand downturn.

In a UBS survey released this month of 80 companies, half of which spend more than $10 million annually in air, 42 percent said their companies are reducing air expenses this year compared to last. That figure is up from 26 percent in October 2007--the quickest and largest such spike since UBS began conducting the twice-annual survey two years ago.

UBS airline analyst Kevin Crissey said the survey's findings are "directionally consistent with the weak economic data being reported and the historical relationship between airline revenue and the economy. However, if correct, it spells trouble for airlines that clearly need to increase revenue to offset much higher year-over-year fuel prices."

While Randall Kane, partner and chief operating officer at management consulting firm Acquis Consulting Group, said he has not encountered any companies this...

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