Global travel and meetings specialist, CWT, and the Global Business Travel Association (GBTA) give a glimpse into the future with the CWT GBTA Global Business Travel Forecast 2024.
Over 70 million ticketed flights, 125 million hotel room night bookings, and 30 million car hires. This is just some of the data thatCWT and theGlobal Business Travel Association (GBTA) base their price forecasts on. With the help of acclaimed global futurist and New York Times best-selling author,Dr. Shawn DuBravac of theAvrio Institute , CWT and GBTA are digging deep and looking at millions of bookings going as far back as 2018 and combining this data with expert interviews and analysis from industry leaders to provide the best insight to travel buyers in 2024.
Now in its ninth year, the current CWT-GBTA forecast will help businesses gauge market pricing for average hotel rooms, airfares, car rental, and meetings and events so travel buyers can better plan for the year ahead.
So, what could corporate travel look like next year? And how can corporate travel buyers make the most of their travel budget? Here’s a sneak peek at highlights from the report.
Costs soar as travel rebounds
According to the report, the good news is that travel is nearly back to pre-pandemic levels: airlines are anticipating 4.35 billion passengers worldwide this year – near to the 4.54 billion passengers in 2019. The bad news is that this renewed demand has led to an astounding rise in travel prices that is defying all expectations.
The report finds that in 2022, the average ticket price (ATP) for a flight rose by an astonishing 72.2%, greater than last year’s huge predicted hike, which was + 48%. Hotels are showing a similar trend: room rates rose 28.9%, and many cities are reporting their highest daily room rates on record. Meanwhile car rental prices increased 9.8% to an average of US$45 a day.
With steady travel demand, for now, travel suppliers have the upper hand in price setting. Travel will continue to grow through 2024, but with the global economy slowing down, prices are set to grow at a much slower pace.
Higher prices are creating new trends
Across the board, travel is becoming increasingly personalized, resulting in a greater variety of prices and options. Theincreased adoption of NDC will only further this trend, with travel sellers having more options as to how they can fragment their pricing. While flights are getting more expensive, premium products are growing the fastest. Airlines are investing in their cabin layouts to create more luxe first-class cabins, as well as a larger variety of business class offerings. To offset the new costs,Qatar Airways unveiled a “Business Class Lite ” fare, which gives passengers the prized business class experience minus lounge access, date or route changes, and fewer miles.Japan’s Zipair andFinnair also began offering basic business tickets in 2021, whileAir France and KLM added Business Class Light fares in 2023. This is just one of the trends emerging from higher prices: corporate travelers still want a business class experience, but with a more manageable price tag.
Hotels are also jumping on this trend and starting to use attribute-based booking, which allows guests to choose individual components for their room, a trend which could impact hotel pricing going forward.
'Carbon budgeting’ - counting emissions – is gaining traction. Amadeus, for instance, providesIT solutions that improve environmental efficiency by displaying, benchmarking, and reporting the CO2 emissions of a trip. This growing traction will then influence the types of travel booked in the future, for example, there may be pressure to replace short haul flights with alternative travel options like car or rail.
Finally, “travel batching” and “blended travel” are on the rise. To save money, many business travelers are “batching” their travel, and visiting more destinations within a single trip, and travel managers are reporting an interest in travel “blending,” with employees tacking on a leisure trip to extend their work away from home. Overall, these trends have been reflected in a 10% increase in multi-destination journeys compared to pre-pandemic levels. Essential to this new trend is having a seamless, online business travel booking experience, which is why Amadeus has launched Cytric Easy .
How can travel buyers stay ahead of growing travel costs?
For now, market control has shifted to travel suppliers, but with a global economic slowdown on the horizon, business travel prices will dampen travel price growth. Travel buyers can make the most of their travel budgets with a few key changes:
A shift to long-term planning - Planning ahead will give travel buyers more options to achieve better leverage in negotiations.
Consolidate and compromise - The goal should be to travel more efficiently. Buyers must aggregate travel spending to maximize value and do regular contract proposals. Data analytics can also do the heavy lifting, highlighting opportunities to reduce costs.
Drilling down on value generators - Businesses can focus on business trips that provide the greatest return on investment, create experiences that attract talent and enable employees to be at their most productive when traveling.
Get to grips with price optimization tools - Suppliers are resorting to sophisticated algorithms and artificial intelligence to assist in pricing models, including continuous and dynamic pricing. Buyers can stay ahead of the game with regular price tracking.
Use loyalty rewards to your advantage - Suppliers reward loyalty and travel buyers have more negotiation power when they give suppliers more travel volume. If travel is concentrated on a small number of routes and destinations, buyers have a better chance of controlling costs and achieving discounts.
Experiment - Test new travel technologies, policies, and strategies. Businesses need to think outside of the box in terms of where they travel, where they stay and the types of events they conduct.
These are just some highlights from the CWT GBTA Global Business Travel Forecast 2024. For a detailed breakdown of pricing trends across the travel industry in 2024,click here to dive into the full report.
TO TOP