American Express Global Business Travel released on Thursday its Global Business Travel Forecast 2013, which forecast hotel prices globally to increase only modestly in 2013. While road warriors will continue to travel, global economic uncertainty is expected to curtail demand and keep rates in mature Latin, Asian and Eastern European markets, as well as in China, relatively flat.
“We are expecting a dynamic landscape for business travel in 2013, with prices likely rising to reflect companies’ interest in doing business in growing economies such as Brazil, India, and Russia, but staying flat or even declining in those markets where growth is stagnant,” said Hervé Sedky, senior vice president and general manager, Global Business Partnerships & Premium Services, American Express Global Business Travel.
While only conservative increases in pricing are expected in North America (the U.S. and Canada), American Express Global Business Travel predicts Latin America’s strong economies and resulting consistent travel demand to likely result in robust price increases in that region in 2013.
In North America, although limited numbers of hotel rooms are expected to be added in 2013, moderate occupancy growth is nevertheless expected to drive increases of 2% to 7% in mid-range hotel rates and 4% to 9% in upper-range hotel rates.
Throughout Latin America, while the hotel construction pipeline remains tight, continued economic growth and middle-class consumer demand are predicted to drive increases in overall hotel rates in the mid-single digits. The majority of this growth is expected to come from Brazil and Argentina.
Europe, Middle East and Africa highlights
American Express Global Business Travel expects only conservative increases in corporate hotel rates, despite relatively constant hotel room capacity. The European hotel market in particular has seen little expansion as recent economic crisis has constrained investment. Russia, the Middle East, and Africa, however, are expected to see moderate growth.
Asia Pacific highlights
Hotel rates in Asia Pacific are expected to differ widely at both the country and city levels. Within China, for instance, predictions reflect the fact that prices in Shanghai suffer from an excess of supply, while in Beijing demand is beginning to outstrip supply.