American Express Predicts Increase in Travel Prices
The American Express Global Business Travel Forecast 2016 predicts that ground transportation prices — along with hotel and air — will see modest gains in 2016 as a slowly-improving economy and strong demand outpace increases in supply.
The American Express Global Business Travel Forecast 2016 predicts ground transportation — along with hotel and air — will see modest gains in 2016 as a slowly-improving economy and strong demand outpace increases in supply.
Ground transportation rates are expected to remain relatively flat as overcapacity, strong competition and a continued focus on ancillary fees persist globally, according to the report.
American Express Global Business Travel’s annual forecast provides subscribers with over 1,800 pricing predictions across airfares, hotel rates and car rental rates in North America; Europe, Middle East and Africa; Latin America; Asia-Pacific.
“While we expect modest increases in global travel prices heading into 2016, travel managers are operating in an era of new challenges and evolving disrupters,” said Caroline Strachan, vice president, consulting, American Express Global Business Travel. “In addition to handling tasks such as measurement and compliance, new factors such as the sharing economy and mobile booking channels are becoming increasingly popular for business travelers. In order to thrive in this digital era, travel managers need to be aware of and dynamically adapt to these forces across a variety of geographies.”
According to American Express’ forecast, here are some predictions on 2016 car rental in global regions:
- North America: The ground transportation market is expected to see limited growth in 2016. Despite aggressive attempts by suppliers to increase pricing, negotiated rates should remain largely flat — although increased ancillary fees will drive up average costs. Ride-sharing services are also expected to see greater mainstream adoption and expansion in 2016.
- Latin America: With the strong competition between the major car rental companies and new local suppliers, Latin American car rental rates are not likely to experience notable increases in 2016. Larger car rental companies are expected to continue to establish themselves across Latin America as they capitalize on business from global corporations and local companies with travel patterns that match their networks.
- Europe, Middle East and Africa (EMEA): The average daily rates for ground transportation in Europe, the Middle East and Africa are all expected to rise in 2016 on higher ancillary expenses. Increased competition and growing demand for smaller, more fuel-efficient vehicles should keep base fares relatively flat in 2016. Carsharing services will also see significant growth in 2016 as major car rental companies make further investments in this area.
For more information on the study, visit www.amexglobalbusinesstravel.com.
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