The roller coaster of business travel pricing, a direct consequence of the pandemic and its lingering effects, seems to be evening out over the next year and a half. Or so suggests the “2025 Global Business Travel Forecast” from CWT and GBTA. The report, gleaning insights from a combination of their partner’s anonymized data and publicly accessible information, anticipates rather minimal swings in airfare, lodging, and ground transport expenses through 2026.
Travel managers, take note: a bit more predictability could be on the horizon. However, several familiar factors continue to loom, influencing the broader landscape: namely, inflation, the always-present specter of economic uncertainty, and persistent geopolitical tensions. The report’s baseline projections hinge on the assumption of continued, albeit softened, global growth. A more pessimistic, recession-driven scenario, however, paints a picture of potentially volatile price fluctuations.
A More Predictable Future, Perhaps
The business travel cost stabilization in the sector seemingly arises from a more balanced interplay between supply and demand, coexisting alongside moderate economic expansion. This, in turn, might let travel managers tweak their programs through, say, focusing on local pricing, smarter negotiation tactics, and even considering innovative event formats. While challenges remain, such as ongoing inflationary pressures and supply chain constraints, the emergence of clearer data and trends facilitates more confident planning. Success, the report notes, hinges on staying informed, adaptable, and closely aligned with overarching business goals.
Flight Prices: A Mixed Outlook
On average globally, airline ticket prices (ATP) saw a 4.8% jump during 2024. However, a slight dip – around 2.2% – is anticipated for 2025, followed by a meager 0.4% bump in 2026. This overall trend is being pushed by a confluence of factors: increased airline capacity, and decreases in fuel costs, although, unfortunately, aircraft delivery delays might constrain the degree of capacity recovery in some locales, thus pressuring prices downward to a certain extent.
North America (NORAM): The ATP champion of 2024, hitting $831 (up 6.9%). This was driven by demand for long-distance flights and, perhaps unsurprisingly, premium bookings. A nearly 3% drop to $807 is predicted for 2025, followed by a slight rise, around 1.7%, to $821 in 2026.
Europe, Middle East, and Africa (EMEA): Here, ATP rose 4.8%, reaching $823 in 2024, with somewhat modest growth: 0.6% in 2025 and 2.1% in 2026.
Asia-Pacific (APAC): ATP increased by 2.9% to $502 in 2024. Slight declines are expected in 2025 (1.8%), with a bump back up of 0.8% forecast for 2026.
Latin America (LATAM): ATP went up 1.7% to $667 in 2024; anticipate a slight 0.4% decrease in 2025, and a 1.7% gain in 2026.
Hotel Prices: Moderate Growth Amid Supply Constraints
Hotel prices, generally speaking, are inching upwards. High occupancy rates and a limited influx of new rooms, itself related to high construction expenses and stricter lending conditions, are key drivers. The global average daily rate (ADR) climbed 1.9% in 2024, to $161. Further growth, of 1.2% and 1.8%, respectively, is projected for 2025 and 2026.
Latin America (LATAM): This region saw the biggest ADR surge: a hefty 7.5% jump, bringing the average to $100 in 2024. Rises of 7% and 5.7% are anticipated in 2025 and 2026, respectively; likely fueled by strong domestic demand and prevailing inflationary pressures.
Asia-Pacific (APAC): ADR went up 4.5% to reach $138 in 2024, with predicted increases of 3.6% and 2.8% for 2025 and 2026.
North America (NORAM): ADR here rose 3.3%, arriving at $188 in 2024; growth of 2.1% and 1.6% is projected for 2025 and 2026.
Europe, Middle East, and Africa (EMEA): ADR grew 1.3% to $157 in 2024; expect roughly 1.9% growth for both 2025 and 2026.
Ground Transportation: Levels off… at Higher Prices
Rental car rates, which spiked quite dramatically in the post-pandemic period, are now stabilizing, albeit at these previously elevated levels. Globally, the average daily rate rose by 6.1% in 2024, with a more subdued growth of 2.9% in 2025, and 2.8% in 2026, likely bolstered by improved vehicle availability and heightened competition.
Meetings and Events: Rising Costs, Shifting Strategies
The cost per attendee at meetings and events grew 4.5% in 2024, which is largely due to higher labor and production costs, combined with an increasing trend towards smaller-scale, premium events. Slower growth, around 3.7% in 2025 and 2.4% in 2026, is anticipated, aligning with overall inflation trends. In response to rising expenses, planners are increasingly opting for venues in smaller, less expensive cities. At the same time, sustainability concerns and advanced technical requirements continue to push budgets even higher.
Strategic Opportunities in a Stable Market
Businesses can enhance the overall return by utilizing regional cost dynamics, securing more advantageous agreements, and modifying event styles, creating a more stable environment. Nevertheless, prevailing economic and geopolitical factors necessitate careful monitoring and agility to harmonize travel plans with company objectives. In this evolving business travel environment, fact-based choices become essential to handle business travel costs effectively.