Travel Procurement

Sourcing Options in Unexpected Places

Consolidation in both the hotel industry (think: Marriott and Starwood) and the airline industry (most notably, American and US Airways) has caused corporates to worry about their options—and their negotiating power. But alternatives are emerging.

When American and US Airways merged, the Big Four became the Big Three. But the fourth-largest U.S. airline, Southwest, has been gaining steam, providing travelers another option and lending corporate travel buyers leverage for negotiations with other carriers. Transportation editor Michael B. Baker’s Q&A with Southwest’s new managing director of business development, Dave Harvey, on page 28, delves into Southwest’s new focus on corporate sales.

And now, Alaska Air Group has agreed to acquire Virgin America to create the fifth-largest U.S. airline. The merger, between two carriers that have plenty of fans among the business traveler set, is expected to close Jan. 1. Editor-in-chief Elizabeth West and her predecessor, Chris Davis, merged efforts for our cover story on page 14, analyzing what the carriers will get out of the deal, what the combined network will look like and what it means for corporate travel programs.

It would be overstating things to say Southwest’s and Alaska Air’s rising profiles mean the U.S. airline industry now is led by the Big Five carriers, but they certainly will impact the business travel industry.

Meanwhile, private-jet suppliers are proliferating—we break down the options on page 22—and a new company, profiled on page 26, looks to bring the private-jet experience to ground transportation. And on page 18, lodging editor Julie Sickel examines select-service hotels’ increasing market share, as well as the resulting pros and cons for corporate travel programs.