By Scott Mayerowitz AP Airlines Writer
New York February 8, 2011 (AP)

Business travel, slowed by recession and the shame of bailouts, makes a comeback.

U.S. companies are forecast to spend 5 percent more on travel in 2011 than they did last year — a sign of confidence in the economy that is giving a boost to airlines, hotels and rental-car companies. That's double the growth rate from 2010, which followed two years of decline.

Last year's bump in business travel — companies spent an estimated $228 billion — helped U.S. airlines post their first collective profit in three years. And profits are rising at hotel chains like Marriott and Hyatt and rental-car companies like Avis and Hertz.

Perhaps the most telling sign of a rebound, industry officials say, is the return of corporate retreats. They had all but vanished during the recession, part of an effort by businesses to avoid the appearance of extravagance at a time of government bailouts and rising unemployment.

Executives sending their workers back on the road say travel is critical to their companies' success.

"You need to have face time," says Robert P. Genco, vice president of operations for Synopsis, a Silicon Valley company that makes software for microchip manufacturers. Synopsis cut its travel budget by about 60 percent during the recession. Now it's nearly back to a pre-recession level, with salesmen and top executives visiting old and new clients in China, India and Japan.

Elyria Foundry, an Ohio manufacturer of metal parts for the wind turbine, natural gas and mining industries, has been sending engineers and salesmen on the road again to let customers know they are important.

"If you look at the younger generation, they seem addicted to text messages," says CEO Bruce Smith. "When you are there in person, the quality of information you transmit goes up dramatically."

U.S. economic output returned to its pre-recession level in the fourth quarter of 2010, and the economy is forecast to grow faster in 2011. But spending on business travel isn't expected to return to its pre-recession level until the middle of 2013, says Michael W. McCormick, executive director of the Global Business Travel Association. That's partly because companies are asking employees to travel frugally.

Source: http://abcnews.go.com/Travel/wireStory?id=12868794

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