Emerging market performance, financial market turbulence, geopolitical risks, uncertainty surrounding Brexit, potentially fluctuating U.S. interest rates and oil prices are six major risks that could impact travel industry prices and the global economy as a whole, reveals the 2017 Global Travel Price Outlook, a joint research by the Global Business Travel Association (GBTA) and TMC Carlson Wagonlit Travel (CWT).
"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 programmes," said 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 programmes will be watching and reacting to an ever-changing global landscape."
Global air travel pricing is projected to increase by 2.5% in 2017. Asia Pacific, while projected to experience a 1.1% decrease in prices, is expected to remain mostly stable throughout 2017, helped by lower fuel prices.
Japan and Singapore however, are expected to see a significant impact on airfare pricing given currency exchange rate projections.
In terms of hotel prices, Asia Pacific is expected to see prices fall slightly by 0.6%. While mega hotel mergers are making headlines, it is said that their impact on prices will only be felt come 2018.
For the global ground transportation sector, a tough competitive climate will dictate continued flat pricing. In Asia Pacific, prices are expected to increase slightly by 0.8%.
As for meetings and events, modest increases in cost per attendee, per day, are expected for Asia Pacific and North America. Group sizes will increase marginally in the 3-6% range for Asia Pacific, Europe and North America, while remaining flat in Latin America.
Kurt Ekert, President and Chief Executive Officer of CWT, said, "We are seeing relatively low, inconsistent and in some cases fragile economic growth. Travellers and travel managers need to understand their travel patterns and spend, 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."