A Quick Review and Update on the 2018 Global Travel Forecast
Late in 2017, we wrote an article on the Global Business Travel Association (GBTA) business travel forecast for 2018. As we draw closer to the fourth quarter of this year, new statistics and information are becoming available, which allows us to look back and evaluate the GBTA’s 2018 forecast.
Here’s a look at how the GBTA’s forecast has played out across different business travel categories so far.
Air Travel Update
The GBTA’s forecast called for the airline industry to grow by 6% in 2018 after it enjoyed 7% growth in 2017. As of September 2018, the industry was slightly exceeding expectations, growing at a stable 7% vs. the expected 6%. Demand accelerated to 9.5% year-over-year in March, and then it quickly decelerated again in April. Still, growth remains a tick above expectations two-thirds of the way through the year.
As companies start to look forward to 2019, keep an eye on this development: rising fuel costs. In summer 2018, Delta announced a plan to increase corporate airfares to help combat expected rising fuel costs in the back half of the year. Needless to say, rising fuel costs (and the accompanying increase in corporate fares) could bring about interesting changes for business travel in 2019.
The Starwood-Marriott merger was one key thing to watch in 2018, including the possibility of the company eliminating brands and/or making changes to loyalty programs.
So far, the only major change has been the announcement of a new unified loyalty program that will include 8 tiers. This could be a significant change for some Marriott loyalists who have become used to a 9-tier award chart. As the new program goes into effect, check your favorite hotels in your regular destinations to make sure they fit into the award tier that you prefer.
The GBTA forecast also addressed the ongoing use of dynamic pricing by hotel providers. The use of dynamic pricing has continued to rise. Talk to your preferred hotel partners about pre-negotiated rates to ensure your travelers don’t get caught paying prices at the high end of the dynamic spectrum.
Ground Transportation Update
The major trend to watch in ground transportation in 2018 is the shift away from taxis and toward car-share services like Uber and Lyft. Ride-share companies continue to dominate taxis, and the rise of ride-share services is also to thank for even greater consolidation in the car rental industry, where only 3 companies now serve 95% of the market — which is never good for consumers and business-friendly rental rates.
If your travel policy doesn’t yet outline rules for ride-share services, it’s time to include them. Beware expensive rates in a consolidating rental car industry, and, like with hotels, make sure you’re pre-negotiating to get the most affordable pricing possible.
Stay ‘in the Know’ About Business Travel
The business travel industry is always shifting, and it can be difficult for even the most dedicated travel manager to stay on top of changes.
At JTB Business Travel, we keep up to date so that you don’t have to. In addition to our services as a comprehensive corporate travel agency, we also regularly share industry news and insights that can help travel managers, executives and even travelers themselves.
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