American Express Business Travel Survey

American Express Business Travel, the world’s largest travel management company, released today its 2006 Global Business Travel Forecast that indicates strong price increases in the global business travel industry and suggests a more challenging corporate travel buying market in the year ahead.

Although the pace varies significantly by region and country, published air and hotel prices worldwide are expected to rise considerably next year as business travel demand recovers in step with the global economy, outpacing the growth of supply in many markets. Regions of strong business travel demand include Europe, North America and Japan, Asia-Pacific and Australia (JAPA), with significant traffic in the trans-Pacific and trans-Atlantic markets.

Published air and hotel rates will increase as suppliers feel intense pressure to recover losses, soften the effect of skyrocketing fuel costs, and in some cases even grow profits. While pricing pressure remains across the airline industry, continuing competition from low-cost carriers may limit airlines’ ability to raise fares in many markets.

Globally for 2006, American Express Business Travel forecasts domestic/short-haul, economy class fares will rise by three to six percent and international/long-haul business fares increasing by three to five percent. On the hotel side, room rates overall for mid-range properties will increase by one to three percent, while upper-range properties will increase by three to five percent.

Japan, Asia – Pacific and Australia (JAPA)

American Express is predicting a two to three percent increase in domestic/short-haul fares within key countries of the JAPA region in 2006.  On international/long-haul routes, product upgrades and service improvements could lead to a three to four percent increase. The proliferation of regional, low-cost carriers operating short-haul routes within Asia is expected to soften the upward pressure on pricing.

On the hotel side, American Express Business Travel forecasts a four to five percent increase in mid-range hotel rates across the JAPA region, and an eight to nine percent increase in upper-range hotel rates. The dynamic growth rates air and hotel will continue to have a predictable effect on hotels, especially in markets like Bangalore, Hyderabad, Mumbai, Shanghai and Beijing.

For more information, go to: http://home3.americanexpress.com/corp/pc/2005/aebt-forecast.asp