These 7 Countries Will Have The Highest Air Travel Price Increases In 2016
Illustration courtesy of the GBTA Foundation
This week the GBTA Foundation released their 2016 Global Travel Price Outlook. The report gives projections for air travel, hotel, ground transportation plus meetings and events prices for the next year on a country-by-country basis. This research indicated that despite signs travel prices are going to stay relatively flat around the globe, there are six countries where the data foresees stronger price increases.
“Business travel is a leading indicator of global economic activity,” said Joseph Bates, GBTA Foundation vice president of research. “The top-line pricing outlook for air, hotel and ground in 2016 is surprisingly stable. But when you dig deeper, the data reveal global hot spots where demand is driving air travel price increases.”
For instance, the report predicts there will be a 1.2 percent increase in air travel prices for Asia Pacific, 0.8 percent for Latin America, 0.5 percent for the U.S., and a 0.4 percent increase for Europe, the Middle East and Africa.
In contrast to these minimal amounts, the following countries are could see more significant increases:
Colombia is going to see about a 3 percent increase next year. This is due to a rapidly growing middle class and stable economy that has driven demand while the capacity has grown very little. The report also shows Mexico — driven by increased demand — may also experience about the same elevation of prices.
Heading to the Eastern Hemisphere, Singapore is experiencing lower energy prices and a less restrictive monetary policy and therefore increased demand is projected to raise their air travel prices by 3 percent as well. The consumer confidence and spiking business growth in India puts it at about 2.6 percent. Even despite slowing economic growth and business travel volume, huge demand is bolstering a 2.8 expected increase in China next year. Australia is forecasted with as much as a 2.7 percent increase from improving business conditions boosting domestic air travel. The big winner (or loser for travelers) is Venezuela, who is projected to see a 6.3 percent increase, caused by high inflation, a drop in oil prices and currency that is fixed to the U.S. dollar.
The report also provides information about hotel, ground transport, meetings and events rates. Hotel rates are expected to go up globally due to demand outpacing supply in nearly every market. Look for a 1.8 percent increase in Europe, the Middle East and Africa; a 3 percent increase in Asia Pacific and a 3.7 percent in Latin America. In the U.S., with high demand driven by economic activity in the Bay Area, Los Angeles and other major cities, expect the rates to increase by 4.3 percent.
Car rental prices are expected to stay close to the same but there may be an impact to the rental companies’ car share and sedan/black car segments. And for meeting and events, the price per attendee per day and group size are expected to stay roughly the same with the exception of Asia Pacific and North America.
The full report can be found here.
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