Corporate Travel to Increase due to Cheap Airfare in 2017
Emerging market activity in South America and Asia combined with cheap airfares is expected to afford more companies the opportunity for more corporate travel and to conduct business face-to-face with its clients in 2017.
According to Advito’s 2017 industry forecast, the outlook for various regions is the result of some tangible economic indicators, as well as some intangible appetites. Here’s how the forecast breaks down by region:
North American business travel is expected to be strong, although concerns about the presidential election and a possible interest rate hike are creating some uncertainty for 2017. Continuing competition between the top three airline carriers will keep airfares cheap, while hotel rates will increase as the chains reduce the number of rooms they make available at a negotiated discount. They will instead seek to implement dynamic pricing for corporate travel clients, thereby decreasing their negotiating options and driving up rates between three and five percent.
The forecast for travel to South America is dominated by the chaotic economic situation in several major countries, particularly Brazil and Argentina. While fares are generally expected to remain flat, business travelers flying from South America to Europe and Asia will see a decrease of two percent. Hotels are expected to drastically decrease their rates in an attempt to increase demand.
Corporate travel across Europe will remain cheap, due to Brexit and the growth of low-cost carriers. International fares from the region are expected to increase one percent, while domestic rates will decrease by the same percentage.
The saying, “It’s the economy,” applies to Asia’s travel forecast as well. Declining economic growth will result in a decrease in travel, especially in China. The country expected to see the biggest travel boom is India, where the increased air capacity will positively impact airfare prices. While business travel may decrease, the region’s growing middle class, with its penchant for leisure travel, will drive the expansion of new direct routes.
Business travelers, are your travel plans going to increase or decrease for 2017? How much are you affected by price increases or decreases in airfare and hotels? Share your thoughts in the comments below, on our Facebook page, or in our Twitter stream.
Photo credit: Gietje (Wikimedia Commons, public domain)