Advito Industry Forecast 2016 March Update
Advito: Oil surplus to continue suppressing air prices; virtual collaboration, ‘alternative’ payment, on-demand services are topics to watch
Copenhagen, March 22, 2016 – Advito’s latest update to its forecast of key economic trends affecting the travel industry finds reason to expect most airfares and hotel room prices globally will remain flat or decline in 2016. The global business travel consultancy provides forecasts in seven major regions for regional and intercontinental flights in business and economy classes, as well as projections for average daily hotel rates and economic growth assumptions.
In addition to its focus on projected prices affecting travel costs, Advito’s March Update to its 2016 Industry Forecast also identifies three trends likely to capture the interest of corporate travel managers:
- A renewed embrace of virtual collaboration technologies
- The ever increasing popularity of payment mechanisms beyond credit cards
- Corporate interest in on-demand services beyond rides and rooms
Given the current environment of low oil prices and a projected stagnation in both demand and capacity, Advito expects most airfares will remain flat or decline in 2016. Regional exceptions include rising intercontinental fares in some Latin American markets and the Southwest Pacific.
For hotels, Advito’s latest analysis has led the business travel consultancy to adjust previous forecasts for two regions (assuming payment in local currency). Advito has lowered its predictions for European hotel rates to 1%-3% instead of 2%-4% as previously forecast. Predictions for Latin America hotel rates increase 2%-4% from 3%-5%, driven by rate increases in Argentina and Chile.
Advito’s annual Industry Forecast and quarterly updates help corporate travel buyers establish cost baselines for negotiating discounted corporate rates with travel suppliers. In addition to publishing its findings on global airline fares by class and hotel rates by key markets, Advito also educates corporate travel buyers to emerging trends in travel technology, pricing and marketing that affect travel program costs and effectiveness.
Advito predicts that virtual collaboration, alternative payment and on-demand services will attract significant attention among corporate travel buyers in 2016. Improved technologies, as well as concerns about costs, risk, work-life-balance and the environment are driving a renewed consideration of virtual collaboration as a useful travel alternative. Advito will explore the topic further in a soon-to-be-released white paper.
The Advito 2016 Industry Forecast, released in September 2015, features special sections on travel risk and security, Airbnb, hotel program innovation and Lufthansa’s distribution cost charge.
Advito’s trusted advice on travel risk and security has been of particular interest to travel managers following terrorist attacks in November on civilians in Paris.