CWT and GBTA Release 2015 Global Travel Price Outlook Giving Companies Comprehensive Look at Year Ahead
First joint CWT and GBTA forecast shows moderate price increases expected worldwide
“With business travel prices on the rise, this study is the key to effective budgeting,” said Christophe Renard, vice president, CWT Solutions Group. “Working with the GBTA Foundation has allowed us to share best practice, industry knowledge and expertise to create a wide-ranging look at the year ahead.”
“The study reveals that travel managers expect price increases next year across the board on travel categories including airfares, hotel room rates and rental car rates,” said Joseph Bates, GBTA Foundation vice president of research. “Risks to the forecast including the escalating Ukrainian crisis; declining European inflation; burgeoning debt in China and oil price shocks could potentially have a negative influence on travel demand and pricing however, so travel managers are advised to consider contingencies for these risks in their planning.”
The 2015 Global Travel Price Outlook is split by category: Air; hotel; ground; and meetings & events, making for easy comparison across regions.
AirWith rising demand, favorable cost structures and slowly expanding capacity, airfares are expected to rise gradually through 2015, by as much as 2.2 percent, although low-cost carriers are limiting price increases in some regions.
Latin America will see the highest price increases of any region advancing 3.5 percent, while price growth in Europe will be much more modest. Expect the growth in traffic among low-cost carriers to lead to diminished pricing power of many legacy carriers in Asia Pacific and North American air prices to be driven by airline consolidation and falling capacity.
HotelHotel suppliers will be in a better negotiating position than they have been for some time in 2015, due in part to stronger demand and investor interest, and favorable capital costs. This improved outlook could lead to greater pressure on negotiated rates for travel managers and buyers, and globally, prices are expected to rise by as much as 2.6 percent.
Price growth will be led by Latin America, with an expected 6.3 percent increase in managed rates. Hotel prices in North America and Asia Pacific will see moderate growth, while hotel rates throughout EMEA will grow more slowly than the global average throughout 2015.
GroundIn contrast to the air and hotel sectors, the ground transportation industry has an abundance of supply. With industry consolidation and strong competition, global prices are expected to remain flat throughout 2015.
The trend will be similar across all regions, except Latin America, where moderate price growth of 2 percent is expected in 2015, based on generally high travel demand throughout the region.
Meetings & EventsCompliance will remain a concern for the meetings & events sector next year, regardless of industry or geography. While there are some exceptions by country, there are several trends expected across the industry in 2015, including a rise in the use of social technology.
It is expected that there will be more domestic meetings and shorter booking lead times across the globe in 2015. Mid-price hotels offering core meetings & events services will be most popular.
To view the report in full, please visit http://www3.gbta.org/l/5572/2014-08-06/x3kvm. CWT will be releasing 2015 price forecasts for the meetings & events and energy, resources & marine industries later this year.