ALEXANDRIA, Va. — According to new research out today, global travel prices are set to increase marginally or remain flat for 2017 and geopolitical and economic uncertainty mean travel managers need to remain flexible and agile.
The 2017 Global Travel Price Outlook, from U.S.-based GBTA Foundation (the education and research arm of the Global Business Travel Association and travel management company Carlson Wagonlit Travel (CWT), highlights six key risks heading into 2017 that could impact both travel industry prices and the global economy as a whole — emerging market performance, financial market turbulence, geopolitical risks, uncertainty surrounding Brexit, potentially fluctuating U.S. interest rates and oil prices.
“While business travel repeatedly demonstrates its resilience, the high level of global uncertainty we face heading into 2017 means travel buyers have to be more nimble and flexible than ever in crafting travel programs,” says Jeanne Liu, GBTA Foundation vice-president for research. “The outlook shows only marginal increases or flat travel prices, but for 2017, the key to building successful travel programs will be watching and reacting to an ever-changing global landscape.”
The third annual report provides global, regional and country-by-country projections for air travel, hotel, ground transportation and meetings and events prices in 2017.
“We are seeing relatively low, inconsistent and in some cases fragile economic growth,” says Kurt Ekert, president and CEO of CWT. “Travellers and travel managers need to understand travel patterns and spending, and be alert to the impact of economic uncertainty and volatility. Proper planning will put them in position to make changes when necessary, and to avoid downside financial risk.”
On the hotel front, the report says although mergers are grabbing headlines, the impact on prices likely won’t be felt until 2018. It also states that hotel services, such as room service, laundry and security, remain important to corporate travellers. Traditional hotels, therefore, remain an attractive option for business travelers, despite the sharing economy options. Overall, North American hotel prices are expected to rise by four per cent in 2017, but it will be a tale of two coasts. Western cities, including Seattle, Los Angeles, San Jose and Vancouver, will experience high single- to double-digit growth because of the high-tech boom and a shortage of hotel rooms, while the west — New York City and Toronto, as well as Canada’s oil and gas region — will face low growth or even a reduction because of an over-supply of hotel rooms.
The full report is available here.