10 December 2009

HotwireÃ¢â¬â¢s crystal ball sees dropping hotel rates and flat airline prices

What’s ahead for travel?

Here are some of Hotwire’s 2010 Travel Industry Predictions:

o "Hotel prices will continue to drop: due to slow (if any) recovery in business travel and continued under capacity. Typically bigger cities have the biggest falls. "Smaller cities and towns do a little better with healthier economies causing higher prices," the site says.

o Where are exceptional hotel deals? Las Vegas, Miami, Los Angeles and San Francisco are among areas selling inventory at rates of up to 55 percent off.

o Air prices will stay flat: The latest round of capacity cuts by the national carriers in the second half of 2009 should compensate for the slow recovery in business travel. This should lead to more price stability, although not enough to raise fares on consumers.

o Car rental prices will be high: Car rental companies finally have financial stability, but now with car manufacturer inventories extremely tight, there are few deals to be had and even some sell-outs at airports.

o "Savings will come in the form of vacation packages: Expect to find sharply discounted deals by buying package deals through online travel agencies like Hotwire or Expedia, as travel providers begin to take maximum advantage of one of the few "safe" mechanisms to discount," according to the site.

o Price differences between 5 and 4-star hotels will get smaller: With hotels feeling the recession pinch and trying to lure back business customers, consumers will be able to trade up across the board for more luxury rooms, as the price levels of 5 and 4-star hotels become increasingly compressed.

By David Wilkening