Kickbacks, plain and simple.

For example:

My firm requires we use a corp booking engine. That engine charges a fee to book a ticket online or over the phone. We get a slight discount on fares and they in turn give a kickback each year to my employer.

The real kicker is that they sell some fares as "refundable" when in reality the fares are just regular fares but allow rebooking via this corporate travel agent. They've essentially locked you into using them and any interaction with an agent incurs a fee. My firm doesn't care, they just see that kickback at the end of the year and are happy. They don't care how inconvenient it is to use the TA.

I get some of the desires to control costs but in my case, I have schedules to keep and a lot of last minute travel and the corporate TA is nothing but an inconvenience. I frequently have to put in reasons for "breaking" policy (for example, I don't take red-eyes) on price because the limit between the lowest fare and your ticket is $100. So if the schedule is right but the fare for that is $110, you have to put in a reason why you booked it.

At my previous company, I was once told the reason was integration with their accounting systems and enforcement / guidance around travel policy. e.g., don’t spend more than $X / night at a hotel in a certain city.

Definitely seemed like these middleman agencies were a solution to a problem faced by the finance team.

Yeah I suspect that was it.

Oddly, I don't think a lot of this stuff really accounts for the complexities in air travel.

Like I literally couldn't rent certain types of cars ... and the no cars.... all in the name of saving money.

But I could take a taxi everywhere for 150% of the cost of car rental (at least) because you still had to get from A to B.

The end result was "don't check that box!" but any other box was ok even if it did the same thing or worse.

I recently had a fun experience with something called the "Fly America Act", a law which says that when the US government is paying for your travel you have to fly on a US flagged airline.

For my trip, the flight would've been about 6 hours (direct!) and cost $600 on a foreign airline. On the cheapest US carrier, the flight was about $850 and took 10 hours due to a layover. When you take hourly rates into account, it easily cost the government an extra $1000 for me to travel on the US airline.

I wish I could've taken the direct foreign flight and just sent United a check for $250. Would've been a win/win for everyone— the American airline gets its corporate welfare without any of the costs they incur when someone actually gets on their plane, and I wouldn't have had to waste 4 hours of my life each way sitting in an airport to satisfy a dumb law.

The Fly America Act is pork for the Airline industry; they aren't intended to save the taxpayer money. Exactly the opposite.

I've even seen identical itineraries -- one under a US flag carrier and the other under a foreign flag -- with a mid-3-figure price difference. The airlines know what they are doing.

Call your congresspeople.

Yeah, that's another big problem. Rules are complex, but most companies in the space are taking a simple approach by defining static rules rather than ones built on top of market conditions that humans can easily reason about (eg "this non stop flight is $500 more, is it worth it? it's the only reasonable way to be awake during tomorrow's meeting"). It's all very broken, and we're hoping to solve it

Exactly. I'd say many companies are worse off w/ traditional middle man agencies. They don't save time and often cost the company more money (though there are some merits in the problems they prevent, like abuse, at scale).

We look at most of the top corporate travel portals and think "worse Google Flights". We want to help the employees save time, while they want to fill a checklist for the finance team. Obviously, this is trickier than it sounds since our ideal "stakeholder" is different than much of the market, but we think it's possible by targeting teams that waste the most time coordinating travel.

Don't you think it was policy so they can capture the information and get reporting?

Oh I have no doubt.

I write some software that involves accounting. Surprising how they drive A LOT of things. Sometimes a bit too much...