Business travel prices are expected to rise sharply in 2019, a new study warns today.
Hotel rates are expected to go up 3.7% and flights by 2.6% driven by a growing global economy and rising oil prices.
Air fares are likely to become more expensive due to rising fuel costs, the competitive pressure from the shortage of pilots, potential trade wars and increasing fare segmentation to improve yield.
The aviation sector will be shaped by the introduction of ultra-long-haul flights and an increasing competition from low-cost carriers, which are not only multiplying but also fighting for long-haul routes – and by the airlines’ push towards Iata’s NDC.
The hotel outlook for 2019 is driven by the overall increase in air travel, which will fuel demand for rooms.
Technology will also play an important part. Hotels are introducing new developments to personalise the guest experience. The increase of mobile penetration, on the other hand, is forcing travel managers to offer their travellers apps, which also serve to accommodate greater in-policy booking autonomy.
Next year will also see a growing preference among travellers for ride-hailing apps while interest in high-speed trains is fading, due to high network costs and low-tech distribution systems.
Mobile mobility will rise. On-demand, shared, electric, and connected cars will all become more popular. Connected car technology has the potential to change the entire automotive industry.
The projections come from the fifth annual global travel forecast, published by the Global Business Travel Association and Carlson Wagonlit Travel.
Gbta executive director Michael McCormick said: “While most major markets appear to be trending in the right direction, downside risks remain for the global economy given the rise of protectionist policies, the risk of stoking trade wars and Brexit uncertainty.
“This forecast provides travel buyers with a better understanding of the global market and key price drivers demonstrating the key to building successful travel programs will be watching and reacting to an ever-changing global landscape.”
CWT president and chief executive Kurt Ekert added: “Prices are expected to spike in many global markets even as inflation remains subdued.
“The report explores the causes and includes an overview of what we expect to see in key markets worldwide. It also gives specific recommendations, giving travel managers ammunition for their upcoming negotiations.”
He added: “The future of corporate travel can be summed up as accelerated personalisation – with mobile technology, AI, machine learning and predictive analytics all playing their part.
“Success is tied to technology, with sophisticated data-crunching at the very heart of it.”