ALEXANDRIA, Va. – The National Business Travel Association (NBTA) released its 2009 Business Travel Overview & Cost Forecast predicting increases in business travel costs and slower than usual travel industry growth. According to the study, travel managers project an increase of 5% to 8% for business travel costs in the coming year. Additionally, as shifting market forces equalize with new levels of supply and demand for travel services, the number of business trips will continue to expand but at a slower pace than the annual growth from 2004 through 2007.
"This year we saw a slowdown in the growth of business travel from the rate of growth we saw in 2004 through 2007. In 2009, we will see a continuation of that slowdown in growth," said NBTA President and CEO Kevin Maguire, CCTE, GLP. "The expansion of the trend is the result of measures travel managers are implementing to contain travel costs during an economic downturn. The measures vary widely from company to company. In some companies, we are already seeing major cutbacks in travel, while other companies have higher travel budgets in place for 2009. Across the board, we can expect to see some changes in the way travel is managed to further maximize value."
NBTA's research predicts that travel managers will amplify their cost-containment strategies in 2009 by implementing or expanding a number of measures, including: reducing non-essential travel; enforcing new travel policy mandates; and implementing tools like eFolio hotel data, which enables automated reporting of hotel spending information in order to streamline expense reporting and flag out-of-policy spending.
In addition to trends in travel management and projections for corporate travel expenditures, the comprehensive forecast predicts rate changes for air travel, hotels, and car rentals:
– In 2009, published airfares are expected to increase 7% to 10% over 2008. This year-over-year change is more difficult to project this year for several reasons: changes in airlines' ancillary fees could add up to 5% to airfares, rapid fluctuations in oil prices impact airline pricing, and airline pricing strategies are designed to react quickly to changes in demand.
– Hotel rates are projected to increase only 1% to 4%, less than increases seen in recent years.
– NBTA predicts nominal car rental rate increases of 1% to 3%.
"NBTA's 2009 forecast supports travel management and c-level leadership with comprehensive insight about the changing travel landscape," added NBTA executive director and COO Bill Connors, CTC. "Our research shows just how much the outlook varies across companies. That's exactly why companies are turning to their travel managers to implement the best strategy to meet the challenges that lie ahead. Those companies who manage travel effectively in the coming year will clearly be better positioned than their competitors who don't."
SOURCE: National Business Travel Association