1 – With the US economy improving slowly, I expect to see equally slow growth when it comes to corporate travel budgets–so don’t expect your company to loosen the reins any time soon. The good news is that I don’t think we will see as many budget cuts and controls as we’ve seen in recent years. Midscale hotels like Best Western that include extras like breakfast, wi-fi and parking along with a reasonable rate will continue to be a travel budget’s best friend.
2 – Increased demand for travel in 2012 will result in higher prices for transportation, fuel, lodging and food, with the biggest jumps in big coastal cities such as New York, Boston, Washington DC, Los Angeles or San Francisco. Between the coasts, where the economic recovery is weaker, prices should remain mostly flat.
3 – Airfares in the US are now 10-20% higher than they were a couple years ago, and should remain that way as airlines continue reduce capacity, consolidate, or, in the case of bankrupt American Airlines, shrink their way to profitability. We’ll also continue to see airlines add or increase those frustrating fees, which they now use to stay in the black.
4 – The price of oil has decreased to about $100 per barrel from a high of around $120 back in April, which is helping to keep gasoline prices down…for now. But keep an eye on events in the Middle East–a flare up in tensions could result in price shocks.
5 – Business travel demand (and prices) will continue to rise in Asia–and here’s some evidence to show just how fast travel demand is growing there: In 2012 China’s Beijing Capital International Airport is expected to surpass Atlanta’s Hartsfield-Jackson International in the US as the world’s busiest. With economic uncertainty hovering over Europe, demand could flatten out, which means prices should stay about the same.