American Express Predicts Travel Price Increase in Select Regions

The Global Business Travel Forecast 2013, released on Oct. 18 from American Express Global Business Travel, projects moderate increases in business travel prices in Latin America, Asia and Eastern Europe with conservative increases expected in North America.

North America

In North America, increased competition is predicted to drive car rental rates down, despite the increase in ancillary fees. Meanwhile, short-haul air fares are expected to rise 2-4%, economy air fares vary and long-haul fares are expected to stay flat. Moderate occupancy growth is expected to drive increases of 2-7% in mid-range hotel rates and 4-9% in upper-range hotel rates.

Latin America

In Latin America, the report predicts short-haul economy air fares to rise 7-10%, long-haul economy air fares to rise 5-8%, short-haul business fares to rise 3-6%, and long-haul business fares to rise 4 – 7%. Continued economic growth and middle-class consumer demand are predicted to drive increases in overall hotel rates.

Europe, Middle East and Africa (EMEA)

Car rental prices in EMEA are expected to be relatively flat in 2013 due to the alternatives available to customers, including bike and car sharing programs. South Africa is expected to be an outlier in car rental with a positive growth in rates.

Markets that will see an increase in travel prices include Russia, where long-haul economy fares are expected to rise by 5-7%, and Poland, where long-haul economy fares are expected to rise by 3-5%. Spain on the other hand — a country hard hit by the region’s currency crisis, will see air fare prices drop.

Asia Pacific (APAC)

Australia’s domestic travel market is very competitive, but demand from the natural resources sector is expected to support moderate travel rate increases.

India is projected to see fare increases of up to 8%. In China, a decline in exports, slowing construction and manufacturing sectors, and impact from investments in Europe are expected to result in declines in business travel demand resulting in pricing that is flat to slightly down overall.

The Global Business Travel Forecast 2013 provides nearly 2,600 predictions across air fares, hotel rates and car rental rates in 29 countries.

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