Country-specific, rather than global, economic trends – such as Brazil’s preparation for upcoming global sporting events, Germany’s relative economic strength within the Eurozone and China’s slower but stabilizing growth – are expected to contribute to a slight uptick in business travel prices within specific regions, according to the American Express Global Business Travel Forecast 2014.
In addition, supply-side dynamics, including more low cost carrier options, weaker demand for business class air travel due to more stringent corporate policies and lack of new hotel construction (or oversupply in some areas) across specific regions are expected to have a greater impact on pricing changes, the forecast says.
“In this environment we recommend travel managers emphasize access to relevant and reliable data and reporting in order to really understand their travel program and to help ensure their travel investments are allocated to support their overall business objectives,” said Janey Whiteside, Senior Vice President and General Manager, American Express Global Business Consulting & Solutions.
“Gaining this understanding can in turn help improve supplier relationships, illuminate compliance gaps and ultimately help enable companies to remain flexible and nimble enough to adjust to changing travel and business environments," Whiteside said.
The Forecast provides subscribers with over 2,100 pricing predictions across airfares, hotel rates, and car rental rates in the Americas; Europe, Middle East and Africa (EMEA); and Asia Pacific (APAC), as well as related travel management program recommendations.
North America: Overall, North American business travelers can likely expect mixed price changes across travel categories in 2014. With minor exceptions, North American airfares are expected to decline in 2014 as a result of heightened competition from low cost carriers, challenging unemployment levels and corporate travel policies becoming more stringent in regard to business class travel. However, pending consolidation among major U.S. airlines may offset these expected declines, the forecast says.
Predicted hotel rates in North America are expected to be up overall; however, the predictions for individual cities are expected to vary widely. Hotel prices in North America’s main travel regions – key business and tourism destinations such as New York and Toronto – will likely continue to grow, but it appears that secondary locations have become saturated with supply and are expected to be more competitive.
Consolidation continues in the North American ground industry and car manufacturers are expected to increase prices on their fleet. Car rental companies may pass the higher costs on to their customers, which may result in moderate price increases in car rental base rates. Key suppliers are also exploring car sharing programs in specific regions as an alternative that can offer increased flexibility and lower costs for corporate clients compared to public transportation.
The Forecast provides subscribers with over 2,100 pricing predictions across airfares, hotel rates, and car rental rates in the Americas; Europe, Middle East and Africa (EMEA); and Asia Pacific (APAC), as well as related travel management program recommendations, services, proprietary research, and end-to-end meetings and events capabilities. These offerings enable clients to optimize the return on their travel and meetings investments.