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Amex forecasts corporate travel prices for 2014
Travel managers likely will see their air expense line shrink next year, but hotel and car rental fees can benefit from some careful management, says American Express, in its Global Business Travel Forecast 2014, released yesterday.
North American airfares are expected to decline in 2014, due to a combination of heightened competition from low cost carriers, challenging unemployment levels and more stringent corporate travel policies, the report says.
That will be offset, however, by rising hotel rates in key business and tourism destinations, such as New York and Toronto, though smaller cities will be more competitive.
Car rental rates may rise moderately, though the new car-sharing programs that allow for hourly rentals can help lower costs.
In Latin America, demand from U.S. companies will likely help create a seller’s market, and rising rates, at mid- and upper-range hotels. Brazil is expected to continue to lead in occupancy levels, and with the Word Cup headed its way, may experience additional increases in hotel rates next year.
Companies should expect to pay slightly more overall for business travel in EMEA in 2014, as suppliers likely make adjustments across air, hotel and ground transportation categories, all of which are expected to remain relatively flat or experience slight increases in the region.
In response to more competition from a strengthening rail industry, which is expected to improve its business class options, larger airlines are expected to follow the model of low-cost carriers.
Hotel rates are expected to increase in nearly all countries and categories in 2014 across Europe, but especially in Germany, one of the stronger economies in the EU.
Airlines in the United Arab Emirates, which has maintained steady economic growth, are expected to add capacity and new global destinations, pushing fares down.
By Cheryl Rosen
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