A Skift Report: Global travel industry intelligence
The current Brexit deadline is set for Oct. 31, and the uncertainty isn't going to end just because a final decision has been made.
Meanwhile, there is an ongoing trade war between the U.S. and China, which is having major global ramifications. Companies are becoming more cautious when it comes to corporate travel. People are looking for a sense of stability before making commitments, meaning 2020 may be a slow year in the business travel world.
A summary is below.
Travel prices not to rise as sharply
After posting sharp rises in 2019, prices in the global travel industry are likely to slow in 2020, with flights rising a modest 1.2%, hotels rising only 1.3%, and rental car rates up 1%, according to the sixth annual Global Travel Forecast. While the global economy is doing well overall – and expected to grow a solid 3.6% in 2020 – a raft of uncertainties are set to put a damper on pricing.
“Technological advancements and an increasingly volatile economic and political landscape across the globe have changed the way today’s travel buyers need to do their jobs,” said Scott Solombrino, GBTA COO and Executive Director. “This annual forecast provides insights into the key drivers forcing these shifting priorities and gives a road map for travel buyers looking to plan their 2020 travel programs.”
Air: 1.3% Hotel: 1.3% Ground: 0.5%
Asia’s expansion has slowed down due to worsening US-China relations, tighter global financial conditions, and natural disasters. But the region remains the most dynamic, with steady GDP growth, benign inflation, and a sense of optimism.
- Air: In Asia Pacific, the shutdown of India-based Jet Airways’ operations in April created a gap in the market for some key routes, and the reduced competition has meant higher airfares.
- Hotel: Asia’s hospitality industry is booming with hotel investment volumes predicted to grow 15% year-on-year.
- Ground: Across Asia Pacific, ride-sharing is booming, with many companies allowing their employees to use these services for business travel. Providers like Didi Chuxing, Grab, Go-Jek and Ola are pursuing aggressive expansion plans.
Middle East & Africa
Air: 2.2% Hotel: 2.5% Ground: 0.5%
The International Monetary Fund (IMF) expects steady growth, ranging from 0.3% in the Middle East to 1.6% in Europe, and 3.6% in Africa.
- Air: Istanbul’s new airport, one of the largest in the region, will likely change flows between Europe and Asia, providing an alternative stopover point for flights to China and Eastern Asia.
- Hotel: Egypt’s hotel prices rates are on the up projected to rise by 4.7% – as its economy settles down after a period of unrest.
- Ground: Rail prices still vary greatly across EMEA due to inconsistent regulation.
For more detailed information, download the 2020 Global Travel Forecast.