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American Express Predicts Robust Increases In Business Travel Pricing In Select Markets In Latin America, Asia, And Eastern Europe In 2013

American Express Global Business Travel expects only conservative increases in corporate hotel rates, despite relatively constant hotel room capacity. The European hotel market in particular has seen little expansion as recent economic crisis has constrained investment. Russia, the Middle East, and Africa, however, are expected to see moderate growth. Car rental prices in EMEA are expected to be relatively flat in 2013, given the many ground transport alternatives – including new bicycle and car sharing programs, car services, and rail – in a European market that is economically anxious, environmentally-sensitive, and population-dense. Again, South Africa is expected to be an outlier when it comes to car rentals, with positive growth.

Asia Pacific (APAC) Highlights

The APAC region exhibits wide variation country to country. For example, Australia’s domestic travel market is very competitive, but demand from the natural resources sector is nevertheless expected to support moderate rate increases. India is projected to see the greatest fare increases in the region, of up to 8%, largely as a result of volatility in that market’s air industry. Meanwhile, in China, a decline in exports, slowing construction and manufacturing sectors, and impact from investments in Europe are expected to result in declines in business travel demand and pricing that is flat to slightly down overall. For domestic flights, in particular, competition from high-speed rail is predicted to exert pricing pressure on both business and economy segments in China.

Hotel rates in APAC, like airfare, are expected to differ widely at both the country and city levels. Within China, for instance, predictions reflect the fact that prices in Shanghai suffer from an excess of supply, while in Beijing demand is beginning to outstrip supply.

For details on how to purchase the Forecast, which includes numerous more insights into air fares and hotel and car rental rates in markets throughout the world, please contact advisoryservices@aexp.com.

About the Global Business Travel Forecast 2013 and Methodology

The Forecast is a key deliverable of American Express Global Business Travel Advisory Services’ E XPERT INSIGHTS research practice, which also produces monthly industry analysis, the Business Travel Monitor pricing index, and detailed travel program best practices and benchmarking reports.

The Forecast is based on a number of primary data sources, including proprietary data from the American Express Business Travel Monitor, the American Express contracted rates database, aggregate transaction data, and secondary data sources including Smith Travel Research (STR) Global Hotel Reviews and economic data projects from Economywatch.com. Projections were based on a combination of these primary and secondary sources and interviews with American Express category and regional experts. All ranges represent forecasted year-over-year changes in negotiated business travel rates.

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