Hotel prices globally may rise 3.7%, airfares 2.6% in 2019: Report

Cost of traveling is likely to rise sharply in 2019 globally, with hotel prices expected to go up by 3.7 percent and airfares by 2.6 percent, driven by growing economy and rising oil prices, a report said today.

“Prices are expected to spike in many global markets even as inflation remains subdued,” said Kurt Ekert, president and chief executive officer, Carlson Wagonlit Travel (CWT).

The fifth annual global travel forecast, published by CWT and Global Business Travel Association, with the support of the Carlson Family Foundation, said airfares are likely to become more costly due to rising oil prices, the competitive pressure from the shortage of pilots, potential trade wars, and increasing fare segmentation to improve yield.

The projections in the report are based on transaction data from CWT’s global client portfolio, including anonymized client travel patterns, over the past seven years. It also includes key macroeconomic and per-country indicators, such as current and expected GDP growth, the consumer price index, unemployment rates and crude oil prices.

Airfares are likely to rise by 3.2 percent in the Asia Pacific next year, including 3.9 percent in China, 7.5 percent in New Zealand and 7.3 percent in India, it said.

“We expect robust private consumption to continue to drive strong growth in India, despite the impact of demonetization and the implementation of the goods and services tax beginning to fade,” the report said.

The only exception in this region according to the report in Japan, where prices likely drop 3.9 percent due to the country’s added capacity in preparation for the Olympic Games in 2020.

In western Europe, the airfares are likely to rise by 4.8 percent, with the increase pronounced in countries like Norway (11.5 percent), Germany (7.3 percent), France (6.9 percent) and Spain (6.7 percent).

In western Europe, the airfares are likely to rise by 4.8 percent, with the increase pronounced in countries like Norway (11.5 percent), Germany (7.3 percent), France (6.9 percent) and Spain (6.7 percent).

Meanwhile, the hotel outlook for the next year is driven by the overall increase in air travel, which will fuel demand for rooms.

In the Asia Pacific, hotel prices are likely to rise by 5.1 percent, with New Zealand clocking an 11.8 percent rise.

However, in Japan, prices are expected to fall by 3.2 percent in 2019.

For ground transportation, including on-demand, shared, electric, and connected cars, rates are likely to stay flat in the Asia Pacific.

New Zealand is expected to whiteness a 4 percent rise, while in India, the rates will go up by 2.7 percent and Australia by 2.4 percent.

Prices in Europe, the Middle East, and Africa are also expected to remain flat overall.

However, countries like Finland, France, Germany, Italy and Spain are expected to see over 4 percent rise in the cost of ground transportation, while Denmark and the UK may witness 3 percent and 2 percent rise, respectively.

Source:-https://economictimes.indiatimes.com/news/international/business/global-airfares-hotel-rates-to-rise-in-2019-industry-forecast/articleshow/65114398.cms

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