Fidest – Agenzia giornalistica/press agency

Quotidiano di informazione – Anno 34 n° 316

Business travelers set to see air fares rise by 8.4%, hotel rates by 8.2%, and car rental charges by 6.8% in 2023

Posted by fidest press agency su mercoledì, 17 agosto 2022

MINNEAPOLIS. Global travel prices are predicted to continue to increase in the remaining months of 2022 and throughout 2023, according to the 2023 Global Business Travel Forecast, published today by CWT, the B2B4E travel management platform, and the Global Business Travel Association (GBTA), the voice of the global business travel industry. Rising fuel prices, labor shortages, and inflationary pressures in raw material costs are the primary drivers of the expected price growth, according to the report, which uses anonymized data generated by CWT and GBTA, with publicly available industry information, and econometric and statistical modeling developed by the Avrio Institute.The world economy shrank 3.4% in 2020 in one of the worst declines since World War II. Service sectors, including travel and hospitality, were hit especially hard, but the global economy recovered briskly, rising off the lows of 2020 and increasing 5.8% in 2021. Economic growth is moderating as the recovery lengthens, although another recession is a growing concern. The current base case scenario for 2022 is for 3% growth, followed by 2.8% growth in 2023.Cautionary notes also highlighted in the 2023 Global Business Travel Forecast, highlight the three main forces exerting pressure on the economy and the business travel industry. These include Russia’s invasion of Ukraine coupled with other geopolitical uncertainties, inflationary pressures that are pushing costs higher, and the risk of further COVID outbreaks that could restrict business travel.Conversely, with businesses ranking sustainability among their top priorities and reflecting the accelerated importance of combating climate change, the report highlights greater visibility at the point of sale for greener travel options, as well as carbon foot-printing, and environmental impact assessment is an opportunity for the travel industry to actively assist in responsible choice-making.Prices have increased in all regions across most categories of spend, fueled by pent-up demand, a desire to build company culture and an uncertain economic outlook. The cost-per-attendee for meetings and events in 2022 is expected to be around 25% higher than in 2019, and it’s forecast to rise a further 7% in 2023.Alongside pent-up demand, corporate events are now competing with many other types of events that were cancelled in 2020. And, with many companies having given up office space during the pandemic in favor of remote working, they are now booking meeting spaces when staff gather in person, further fueling demand.Shorter lead times for events, varying from one to three months versus six to 12 months, are also contributing to this perfect storm, perhaps underscored by corporate concerns that the situation they face today could change very rapidly. This is particularly noticeable within Asia Pacific, which has been slower than other regions to re-open post-pandemic, with ongoing restrictions in China prompting clients to make sure their events can go ahead, and as quickly as possible.Business travel airfares fell over 12% in 2020 from 2019 followed by an additional 26% decline in 2021. Economy ticket prices fell over 24% from 2019 to 2021, while premium tickets fell 33%. Prices are expected to rise 48.5% in 2022, but even with this steep price increase, prices are expected to remain below pre-pandemic levels until 2023. Following an increase of 48.5% in 2022, prices are expected to rise 8.4% in 2023.Hotel prices fell 13.3% in 2020 from 2019 and a further 9.5% in 2021, however the report expects them to rise 18.5% in 2022 followed by an 8.2% lift in 2023. Hotel prices have already eclipsed 2019 levels in some areas such as Europe, the Middle East & Africa and North America and are expected do so globally by 2023.Hotel rates have risen sharply in parts of the world including a 22% rise in North America – and a forecast 31.8% across Europe, the Middle East & Africa – driven by an accelerated recovery coupled with continued capacity constraints.Global car rental prices fell 2.5% in 2020 from 2019, before rising 5.1% in 2021. Prices are expected to increase 7.3% in 2022, hitting new highs, and rise a further 6.8% in 2023. Skyrocketing prices, vehicle shortages and the need for visibility into carbon emissions from door-to-door are driving corporate travel managers to factor ground transport into full trip planning from the beginning. This is especially true when factoring in the inclusion of electric vehicles, and while widespread adoption may still be a few years away, personal preference should not be underrated. (abstract)

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