Report shows how much biz travel will go up

 The outlook for biz travel spending, and meeting and events next year? Prices in most areas will rise, says the Carlson Wagonlit Travel (CWT) 2012 Travel Price Forecast.

What will be the most expensive areas? The booming Latin America region, the report says.

"Travel buyers in most parts of the world are facing tough negotiations as the landscape increases in complexity. At the same time, economic uncertainty continues in some parts of the world and has resurfaced in others, prompting increasing questions on exactly what 2012 holds in store for organizations and, by extension, for business travel," said Nick Vournakis, vice president, CWT Solutions Group.

CWT forecasts airline pricing to increase by about 5.8 percent in 2012, with increases in Colombia topping the charts at 7.9-11.4 percent. This is primarily due to rapidly increasing demand and limited supply in the region.

Average daily hotel rates during the first half of 2012 are expected to increase by 9-11.8 percent, and increase by 10.1-12.2 percent during the second half of the year. Brazil could see increases of more than 24 percent in the first half of 2012 and up to a 34 percent increase during the second half of 2012.

The Asia Pacific (APAC) market is thriving, leading the way in many economic indicators and correspondingly, in business travel volumes.

“However, APAC travel prices will be flatter in 2012 on a quarter-over-quarter basis, given that the region was not as affected by the economic downturn as other parts of the world, and has already been experiencing strong growth rates throughout 2011,” the report says.

CWT forecasts airline pricing in APAC to increase by 3.1-3.8 percent in 2012 “as a dynamic mix of legacy airlines and a growing group of low-cost carriers compete for travelers, holding down fares in the region.

Average daily hotel rates in APAC will range from a 1.9 percent decrease to a 2.1 percent increase in the first half of 2012, and a 0.9 decrease to remaining flat for the second half of the year.

“In 2012, the United States will continue to struggle with high unemployment rates and ongoing effects of the housing crisis that originated during the economic downturn, while Canada's economy has been and is expected to remain relatively stable,” the report says.

Average daily hotel rates in the US will modestly increase in 2012, with very limited growth in Canada.

Spending on business travel has surged this year, but worries over an uncertain economic climate is expected to slow travel spending growth next year, says the Global Business Travel Association.

The Virginia-based trade group says spending on business travel in the US will rise 6.9 percent this year over 2010, hitting US$250.2 billion.
 

But the trade group predicts that a tentative economy next year will slow the trend, leading to growth of 4.3 percent, or $260.9 billion in spending.
 

A bright spot in the forecast is continued growth in spending for international travel, which the group estimated will grow 7.7 percent in 2012 to $34.3 billion.

By David Wilkening