FCM Consulting, a division of travel management company FCM, has released its latest “Global Quarterly Trend Report,” which provides an insightful look at forecasts for the year ahead and the key trends shaping the business travel industry. The report is sourced using FCM’s corporate booking data from the first quarter of this year, between January to March 2024.
According to the report, there has been a gradual, consistent growth in business travel trips to start the year, which is expected to continue into the next quarter. With traveler confidence on the rise and an incremental growth in demand, the data suggests that pricing is expected to remain strong across the industry. Global economy airfares were up $45 (+11 percent) and business class tickets were up $224 (+12 percent) in January 2024, compared to January 2019. In North America, economy ticket prices were up 15 percent and business fares were up 9 percent. But encouragingly, global economy ticket prices actually dropped 16 percent in January, when compared to January 2021.
Given the economic outlook is trending in a relatively positive direction, corporate travel budgets are starting to increase this year. However, despite the steady volume of trips, geopolitical events can often bring a level of uncertainty to the economy. Therefore, businesses are also closely monitoring their budgets and travelers are shifting some of their booking behaviors and preferences to maximize spend. One key trend that the report highlighted is that business travelers are booking trips more in advance, as well as taking longer trips. The average advanced booking days have increased to 23.3 (+1.5), while the average days away have increased to 4.4 (0.3).
Another key trend that has continued on the supply side this year—more seats with less flights. The forecast for North America is that there will be +9 percent more seats and -7 percent less flights offered between May and December 2024, compared to 2019. The global forecast is that there will be +3.6 percent more seats above the 2019 averages, signaling supplier confidence across the world. Furthermore, the forecast of seats offered by the top global airlines is set to be +6 percent above 2019, with the number of flights down 1 percent. Low-cost carriers have also been performing well, representing over 31 percent of global seats offered in 2024 to date.
On the accommodation side, the average room rates (ARR) in North America increased just $5 (+2 percent) in Q1-24, compared to Q1-23. Some of the cities seeing the largest rate increases include New York (+$325), Denver (+$262) and Vancouver (+$316), while Los Angeles (-$226), Boston (-$291) and Mexico City (-$194) saw some of the largest rate decreases. The report also analyzed the car rental market and the global average daily rate (ADR) this past quarter was $51, a $22 drop in price from the 2023 ADR.
Source: FCM Travel
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