Global events to impact 2017 travel prices

Travel industry pricing set to fluctuate in 2017.

New research released by the GBTA Foundation, the education and research arm of the Global Business Travel Association, and leading travel management company Carlson Wagonlit Travel (CWT) has forecast six key risks that could impact both travel industry prices and the global economy in 2017.

The research, entitled 2017 Global Travel Price Outlook highlights emerging market performance, financial market turbulence, geopolitical risks, uncertainty surrounding Brexit and fluctuating U.S. interest rates and oil prices as the key things to watch out for.

“While business travel repeatedly demonstrates its resilience, the high level of global uncertainty we face heading into 2017 means travel buyers have to be more nimble and flexible than ever in crafting travel programs,” GBTA Foundation vice president for research, Jeanne Liu said.

“The outlook shows only marginal increases or flat travel prices, but for 2017, the key to building successful travel programs will be watching and reacting to an ever-changing global landscape.”

Kurt Ekert, President and Chief Executive Officer of CWT claims travellers and travel managers need to react quicker to global changes.

“We are seeing relatively low, inconsistent and in some cases fragile economic growth. Travellers and travel managers need to understand their travel patterns and spend, and be alert to the impact of economic uncertainty and volatility. Proper planning will put them in position to make changes when necessary, and to avoid downside financial risk,” Ekert said.

Meanwhile, closer to home, CWT Managing Director, Australia & New Zealand, Lisa Akeroyd expects the dollar to make an impact.

“With regard to Australia, the economy’s growth has slowed over the past year given a dramatic reduction in demand from the resource and mining sector. Higher unemployment and a depreciating Aussie dollar are all expected to contribute to continued slowed growth into 2017,” Akeroyd said.

Airfares are also projected to decrease by 0.9% in Australia, while New Zealand could see an increase 0.3% in 2017.

“Australia is dealing with significantly reduced demand eased by Qantas and Virgin’s voluntary capacity cuts on Australian routes, fierce international competition for travelers, and further fare decreases because of a declining Aussie dollar,” Akeroyd said.

While airfares are projected to fall, average daily rates for hotels are expected to increase by 4.4% in Australia and 7.6% in New Zealand.

“With the weak Australian dollar, inbound tourism is high and Melbourne and Sydney are increasing upward pricing pressure, with more increases expected for 2017. Conversely, Western Australia is expected to experience low occupancy and an overall decline in room rate pricing due to the continued mining sector slowdown,” Akeroyd said.

The 2017 Global Travel Price Outlook also predicts modest prices increase in the car rental market with prices to rise by 2% in Australia and 1% in New Zealand.

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Email the Travel Weekly team at traveldesk@travelweekly.com.au

Latest comments

Maxwell Smart says:
July 27, 2016 at 1:16 pm
will there be a big airline fail ? Maybe one that flies a lot in or out of France ?
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