Despite fierce competition on both domestic and international routes, 2014 will see a modest increase to the cost of both flights and hotels, says American Express.
The company’s Global Business Travel Forecast 2014 predicts that business class airfares in the Asia Pacific region are tipped to rise by up to 5%, with hotel rates likely increasing by up to 6%.
A global financial and travel management giant, American Express attributes these changes to a ‘less dramatic’ 2014 for Australian domestic flights, envisaging the highest price rises for business class travel (5%), while economy fares are also tipped to increase by up to 4%.
“While growth is slowing in some local countries, the Asia Pacific region is leading the rest of world in terms of economic growth” explains David Reimer, American Express’ General Manager Asia Pacific. “Business travel is still a priority in this region”.
Continued demand is expected for long distance business class fares both to and from Australia – with these predicted to rise by up to 4% – though economy fares are likely to decrease on these longer flights by up to 5%, in part due to increased competition from Asian carriers.
As in 2013, occupancy rates in Australian hotels are expected to remain high overall.
With few new properties opening over the next year and a reasonable demand for existing rooms, rates may rise by up to 6%.
The softened Australian mining sector is putting downward pressure on the Australian dollar, which is likely to make the country more attractive to leisure visitors in the coming year – increasing the demand for both flights and hotels.
While car rental prices may increase slightly, the report notes that the more popular choices of chauffeur transfers and public transportation are expected to maintain their practicality and appeal into 2014.
Travellers to North America will benefit the most with the price of short premium cabin flights set to fall by up to 13%, though visitors to Latin America will face the highest price rises on hotels.
While our Australia-specific advice was provided directly by an American Express spokeswoman, the Forecast’s global snapshot shows rather differing predictions for the regions as a whole:
Businesses who have already negotiated long term price contracts may find themselves ahead of the game, with this being a particularly crafty way to avoid the forthcoming price rises.
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