United Kingdom
United States
Asia Pacific
Amex forecasts a challenging year for travel buyers
The price of flights, hotels, car rental and corporate meetings and events worldwide are all set to climb in 2008, according to the American Express Global Business Travel Forecast published today.
Global airfares are expected to continue to climb, while hotel rates are projected to see high double-digit increases in some markets across the US, Europe and Asia.
“Travel managers and procurement professionals can expect another capacity-restricted, challenging year and a continued push to keep travel and entertainment budgets in check,” said Mike Streit, vice president and global leader for Amex Business Travel Advisory Services.
“However, opportunities still exist to further control costs without curtailing business travel.”
International and long-haul business class fares are forecast to climb 5%-8% globally, while in Europe they are set to rise by 6%-10%.
Meanwhile, global domestic and short-haul economy class fares are set to rise 1%-4%, and in Europe 2%-5%.
The Amex report said fuel costs, improvements in airline inventory and pricing technology, capacity constraint and demand for long haul are likely to drive price increases.
“But we anticipate that greater competition through the US-EU Open Skies Accord, the growth of low-fare pricing models and more efficient aircraft will temper increases,” it said.
Increased competition in the UK mean domestic and short-haul fares are forecast to drop by 5%-10%, while international and long-haul business class fares from the UK are expected to rise only slightly by 1%-2%.
Worldwide mid-range published hotel rates are forecast to climb by 11%-14%, with the same increase predicted for upper-range hotels.
Hotel rates in the Asia Pacific region are set to increase even more, by 18%-22%.
This is partly down to the summer Olympics in Beijing, along with economic growth and an increasingly mobile population.
In the UK, mid-range hotel rates are set to rise 19%-22%, and by 21%-24% in upper-range hotels.
“High demand and slow growth of supply is likely to force prices up and will impact access hoteliers give to last room availability rates,” said the Amex report.
“Companies may also encounter minimum and maximum stay requirements and instances when corporate rates do not apply.”
Rising hotel rates are likely to contribute to the expected increase of 8%-10% percent in global meeting spend, it added.
By Bev Fearis
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Bev
Editor in chief Bev Fearis has been a travel journalist for 25 years. She started her career at Travel Weekly, where she became deputy news editor, before joining Business Traveller as deputy editor and launching the magazine’s website. She has also written travel features, news and expert comment for the Guardian, Observer, Times, Telegraph, Boundless and other consumer titles and was named one of the top 50 UK travel journalists by the Press Gazette.
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