Guest Post: Travel Price Forecast 2013


It is safe to say that 2012 was not an easy year for many, with the global economic outlook varying greatly. The positive performances seen in some countries such as Brazil and Japan, and the slow and steady progress in North America were encouraging. But the debt crisis in Europe remains a real problem and makes Europe the most volatile region of the world at the moment.

Knowing what to expect can help you prepare and make financial savings for your business travel management. Here is a brief guide of what to expect in 2013:

Asia Pacific

In terms of air travel, prices are set to increase modestly in 2013. In Australia, there will be an average ticket increase of about 1% on domestic routes. This is due to a new carbon tax implemented by the Australian government which airlines are passing on to customers.

China’s economy has not kept up with its expected performance over the past few years, with GDP growth that is marginally lower than previously anticipated, prompting more measured airline ticket price increase expectations for 2013.

India’s airline market is undergoing some difficult times, with local carriers finding it difficult to maintain operations in the face of unprofitability and other issues. In addition, fuel prices are heavily regulated by the government, which produces a higher cost to the carriers that inevitably ends up getting passed through to customers.

Europe, the Middle East and Africa

The UK has enjoyed strong hotel inflation in 2012 due to London hosting the Olympic Games. However this inflation is not expected to continue in 2013 due to reduced demand. This is good for travel programmes as accommodation in London is expected to be cheaper in 2013.

As Russia is set to host the Winter Olympic Games and FIFA World Cup over the next six years, this is the market to watch as it remains attractive to investors in 2013.

The UAE has experienced reduced pricing for the past few years, but the ongoing appeal of Dubai, mainly for a growing number of Chinese leisure travellers, should improve the country’s outlook for 2013, although soft business travel will keep prices down.

Latin America

Significant economic disparities exist throughout Latin America, resulting in varied expectations by country for travel prices next year. Travel prices in Brazil are specifically being boosted by its hosting of the upcoming FIFA World Cup and the Olympic Games.

In terms of ground travel, Brazil’s car rental market will continue to expand as major US-based suppliers increase operations into the country to meet growing demand, creating competition between international brands and local suppliers. Modest price increases are anticipated.

North America

The economies of Canada and the US have no expectations of major growth in the foreseeable future; however they continue to move slowly but steadily in a positive direction. This will create flat to moderate price increases for most categories of travel. With the slow rising economy, hotel room rates are also expected to rise, but will remain below the 5% mark in both the US and Canada overall.

More information on business travel trends in 2013 can be found on the Carlson Wagonlit Travel website.


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