Air travel demand has moderated but growth expected in 2014
ATLANTA, March 11, 2014 – Global economic growth will regain momentum this year, with advanced economies driving this change, forecasts travel consultancy Advito. In the latest update to its 2014 Industry Forecast, Advito projects that travel demand will follow this positive growth trend, though at a slightly slower pace than the overall economy.
Growth in air travel demand remained solid throughout 2013 but has recently moderated, according to Advito’s update. This year, fares will vary by region due to airlines’ differing approaches to keeping aircraft full.
Advito, the consulting arm of BCD Travel, continually monitors changes in economic growth, inflation, travel demand and oil prices. Each quarter, it revises its annual Industry Forecast to highlight subsequent updates to the original air and hotel pricing predictions.
The update and the original Advito 2014 Industry Forecast are available at www.advito.com (in the Resource Center section under “White Papers”). Following are a few of the update’s key findings:
- Bringing it in line with its forecast for business fares, Advito lowered its earlier projection for intercontinental economy fares in Europe, from 2% to 1% as demand continues to lag capacity growth.
- Demand continues to outpace capacity in Latin America, pushing up prices on airfares. Based on that observation, Advito raised its forecast for intercontinental economy fares in Latin America from 2% to 4%.
- Excess air capacity on Middle Eastern carriers is pushing down prices for intercontinental business fares in Africa, and Advito expects prices for those fares to continue to fall by 3%. Advito is sticking with its original forecasts for regional fares in Asia, which should drop 4% for business class and drop 2% for economy. The decline results from customer down-trading and a rise in low-cost carrier capacity.
- Hotel forecasts for most regions remain unchanged. Based on higher than expected growth in hotel capacity, Advito adjusted its regional hotel forecast for the Middle East downward, dropping it from the original 2-4% to 1-3%. Advito also adjusted its projections for average daily rates (ADRs) for some individual markets. The update now forecasts lower ADR increases in Qatar and Spain and higher increases in Argentina, Luxembourg and Mexico.
Advito provides travel-management advisory, procurement and outsourcing services that guide clients through a complex travel environment. Our focus on consulting delivers proven value, unbiased counsel and a customized approach for every client and every engagement, together with industry expertise and access to data to drive quantifiable decision-making. We are headquartered in Chicago, and operate in key business markets around the world. We are an independent operating unit of BCD Travel, the world’s third-largest travel management company, owned by BCD Holdings N.V. For more information, visit www.advito.com.
About BCD Travel
BCD Travel helps companies make the most of what they spend on travel. We give travelers innovative tools that keep them safe and productive, and help them make good choices on the road. We partner with travel and procurement leaders to simplify the complexities of business travel, drive savings and satisfaction, and move whole companies toward their goals. In short, we help our clients travel smart and achieve more. We make this happen in 109 countries with a global client retention rate of 98%, the highest in the industry. For more information, visit www.bcdtravel.com.
About BCD Group
BCD Group is a market leader in the travel industry. The privately-owned company was founded in 1975 by John Fentener van Vlissingen and consists of BCD Travel (global corporate travel management and its subsidiary BCD Meetings & Events, global meetings and events agency), Park ‘N Fly (off-airport parking) and Airtrade (consolidation and fulfillment). For more information, visit www.bcdgroup.com.