Uneven recovery levels for global airline and hotel prices

APAC recovery is slower than other regions, driven by China’s zero Covid policy.

China's opening has been predicted to drastically accelerate recovery on an immense scale.
China's opening has been predicted to drastically accelerate recovery on an immense scale. Photo Credit: Adobe/Day Of Victory Stu.

It will take a growing number of meetings and many more flights for the business travel market to recover to the point where business travel is thriving, but the APAC region in particular will have a tougher time than other regions.

This is according to futurist and trencaster Shawn DuBravac, CEO of Avrio Institute. He was speaking to Julian Walker, vice president of external communications and public relations for CWT, in a session at the recent 2022 GBTA convention, discussing the recently released 8th Annual CWT GBTA Global Business Travel Forecast 2023.

DuBravac said: “What we are seeing, since the pandemic began, is this uneven recovery that's taking place. We saw it first with how consumers were spending money, buying goods instead of services and now that's starting to rotate out of goods and towards services. With airline bookings, North America is at an all-time high, places like China are still down 50% from where they were in 2019.”

He added however that the impact from the success of China’s recovery programme would result in a massive escalation ‘in all sorts of travel around the region’. And as business travel returns to other regions, DuBravac said the industry is starting to see a pickup in business travel-oriented accommodation.

He added: “That's driven in part by stronger demand from business travellers but also business travellers and organisations who are more willing to spend on travel. Hotels can build more capacity as required, but obviously when material prices are going up, and with commodity prices unpredictable to say the least, energy and oil prices are going to have a huge, huge impact there too.”

Walker highlighted the growing cost of hosting meetings, with CWT data pointing to a 25% increase this year, saying the cost would go up by a further 5% or 7% next year.

“What we're seeing certainly is the speed to events - people used to have a longer lead time but now there's a sense of urgency,” he said. “It's like’ I want it now’ and that could be affecting the capacity of hotels, because suddenly there isn't that availability.”

Dubravac also noted several other trends: a tendency to book for longer trips, where business travellers are increasingly trying to group things together so they can do more business on one trip and a tendency to book flights and accommodation within a shorter window.

“Travellers are making sure that the event doesn't get cancelled, and that they are not likely to get sick before,” he said.

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