Business travel prices will continue to rise during 2022 and 2023, according to a report.
The report, by the Global Business Travel Association and CWT, said rising fuel prices, labour shortages, and increasing raw material costs were the primary drivers.
Air fares are predicted to rise 48.5% year-on-year in 2022 and then 8.45% in 2023, while hotel rates will rise 18.5% this year and 8.2% in 2023. The figures for car rentals are 7.3% and 6.8% respectively.
Given the drops in travel prices following the pandemic in 2020 and 2021, pricing is “on a par” with 2019.
Patrick Andersen, chief executive officer at CWT, said: “Demand for business travel and meetings is back with a vengeance, of that there is absolutely no doubt.
“Labour shortages across the travel and hospitality industry, rising raw material prices, and greater awareness for responsible travel are all having an impact on services, but predicted pricing is, on the whole, on par with 2019.”
The world economy shrank 3.4% in 2020 but grew 5.8% in 2021, said the report. Assumed growth for 2022 is 3% and 2.8% for 2023 “although another recession is a growing concern”.
The main risk factors for business travel are Russia’s invasion of Ukraine and other geopolitical uncertainties, inflationary pressures, and further Covid outbreaks.
As businesses increase focus on sustainability, travel programmes are featuring greater visibility at the point of sale of carbon footprints and greener travel options, said the report.
Suzanne Neufang, chief executive officer at GBTA, said: “What we are seeing now are multiple factors coming into play when corporate travel buyers and procurement officers model their travel programmes.”
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