According to BCD Travelís 2020 Industry
Forecast, global hotel rates will increase by 1% to 3% and
airfares by 1% to 2% in 2020.
The rate increases will be higher in Asia -
particularly Japan, host of the 2020 Summer Olympics, and Vietnam,
where both leisure and business travel demand is strong.
Airlines are also expected to raise their average fares in
most markets to help offset higher fuel and labor costs. Globally,
average ticket prices are expected to rise between 1% and 2% in
The latest edition of BCD Travelís annual report on
whatís ahead for business travel also analyzes individual regions.
Among the findings:
- Hotel rates in North America will
climb 2% to 4% in the U.S. and Canada, and 0% to 2% in Mexico.
- Hotels will keep adding new properties in Asia, but demand will
continue to outstrip supply. Rates will rise by 2% to 4%.
Strong demand in Europe will push meetings costs up 3% to 4%.
Meetings costs also will increase sharply in Sydney and Auckland,
- Regional airfares will rise by 3% in Latin
America as demand recovers.
- Airfares will rise 1% to 2% on
regional routes in Africa, with higher increases on flights
between the continentís fastest-growing economies.
- Uberís bid
to buy Careem could create a dominant ride-hailing force in the
ďAs we approach 2020, corporate travel buyers
face the prospect of a slowdown in advanced economies, while the
performance of emerging markets improves,Ē said Mike Eggleton,
director of Research & Intelligence for BCD Travel. ďWe believe
this will restore the traditional growth gap that had recently
narrowed between mature and emerging markets.Ē
As an example, Eggleton cited BCDís assumption that the North American economy
will expand by 1.6% while Asian growth will be much stronger,
possibly as high as 4.5%.
Slower global economic expansion
has resulted in weaker growth in demand for air travel year-on-year. Despite this, demand will be strong enough for airlines to
raise fares in most markets to help offset higher fuel and labor
costs. Air capacity expansion will limit fare increases, with some
exceptions. In China and India, strong demand, competitive changes
and regulatory developments will lead to higher fares.
Globally, average air ticket prices for intercontinental travel in
both business and economy classes are expected to rise 1% in 2020.
Intercontinental business class fares will be flat in Latin
America and will fall 1% in Southwest Pacific, where increased
competition on transpacific routes will drive down prices.
In 2020, economy fares for regional flights are expected to rise
by 1%, while business class fares will increase by 2%. Average
ticket price increases will range 1% to 3% across the regions. The
sharpest increase, at 3%, will be for flights within Asia and
Latin America as demand recovers. In Europe, regional economy
fares should remain flat because of low-cost carrier competition.
Hotel demand will boost occupancy rates in 2020, resulting in
average daily rates (ADRs) increasing by 1% to 3%. Asia will see
hotel rate increases averaging 2% to 4% as demand outpaces supply.
Latin America will have the lowest ADR increase at 0% to 2%, as
demand in the region slowly recovers from a period of weakness.
The 2020 Industry Forecast provides travel and procurement
managers with projected prices, insights and guidance to prepare
for new sourcing strategies, supplier negotiations and budgeting.
In addition to providing global supply, demand and pricing trends
for the air, hotel, ground transportation and meetings categories,
the Industry Forecast includes in-depth reports on Africa, Asia,
Europe, Latin America, the Middle East, North America and
Southwest Pacific. A global economic overview includes a focus on
travel risk and security.
You can download the full report