Flight and hotel prices expected to rise sharply next year
Flight and hotel prices are expected to rise sharply in the coming year, according to the 2018 Global Travel Forecast.
Global airfares are expected to rise 3.5% in 2018 and hotel prices by 3.7% , says the fourth annual forecast by the GBTA Foundation in partnership with Carlson Wagonlit Travel.
"The higher pricing is a reflection of the stronger economy and growing demand," said Kurt Ekert, president and CEO, Carlson Wagonlit Travel.
"The global numbers from this forecast should be considered strong leading indicators of what 2018 will mean for global businesses, as we anticipate higher spending."
The rise in airfares comes as oil prices rise and despite airlines adding an expected 6% capacity next year.
Air travel is anticipated to continue growing, with prices rising 7.1% across Eastern Europe and 5.5% in Western Europe.
Meanwhile, Middle East and African countries only expect a 3% rise due to ongoing security threats and an oil industry that is still in recovery.
Asia Pacific expects to see a 2.8% rise in 2018 pricing with domestic demand increasing, particularly in China and India.
North America prices are forecast to rise 2.3%, while Canadian airlines are expected to aggressively compete given new market entrants and capacity growth of about 11% in 2017 and 12% in 2018.
Meanwhile in the hotel sector, European hotels are expected to post strong increases, while other regions are barely keeping up with inflation.
Across EMEA, hotel prices are likely to rise 6.6% in Eastern Europe, 6.3% in Western Europe, but only a modest 0.6 percent in the Middle East and Africa.
Norway is expected to lead with increases of 14% expected for 2018, while Russian hotel prices will rise 11.9% thanks to increased demand from hosting the 2018 Summer World Cup.
Prices are expected to fall in Latin America and the Caribbean
Across Asia Pacific, hotel prices are likely to rise 3.5% overall, but with a large discrepancy as Japanese prices are expected to fall 4.1%, but New Zealand is set to rise a full 9.8%.
"North American hoteliers may be banking on economic growth as demand has levelled off since mid-summer 2016, but supply is expected to continue growing steadily through 2018," said the report.
"With international travel projected to grow 4% in 2017 and 2018, US hotel growth is expected to be concentrated primarily along with the West Coast and in Washington D.C.
Bev
Editor in chief Bev Fearis has been a travel journalist for 25 years. She started her career at Travel Weekly, where she became deputy news editor, before joining Business Traveller as deputy editor and launching the magazine’s website. She has also written travel features, news and expert comment for the Guardian, Observer, Times, Telegraph, Boundless and other consumer titles and was named one of the top 50 UK travel journalists by the Press Gazette.
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