American Express Business Travel announced pricing projections from its annual Global Business Travel Forecast, indicating increases of up to 10 percent for airfare and hotel rates in key markets around the world. The forecast also predicts that companies will hold more meetings next year.
"Throughout 2010, companies have lifted travel restrictions brought on by red bottom line fears and this is expected to continue into 2011 as firms look more toward growing the top line. Yet pricing power will swing back to air and hotel suppliers for the first time in two years in 2011 as more competition for limited seats on planes and increased occupancy levels at hotels are expected," stated Christa Degnan Manning, director of eXpert insights and research, American Express Business Travel.
"As a result, companies should re-examine program strategies and policies undertaken in the past few years and look to manage budgets and cost-control tactics competitively to protect them from the significant rate increases expected," she added.
The report findings indicated that companies will likely increase spending and frequency of meetings, however they will likely spend less per meeting on average as meeting size decreases and sourcing efficiencies increase.
Aligning with this prediction, more meetings are expected to be held on local or regional levels, and will continue to have fewer amenities, with audiovisual services being the only exception. As planners incorporate virtual alternatives and supplements to face-to-face experiences, investments in these technologies are expected to continue to go up.
