News for the Hospitality Executive
American Express Reports Q2 Business Travel Monitor
Results for North America
Hotel Rates Show Modest Decrease in Q2 2009
SAN DIEGO - August 25, 2009 - At the National Business Travel Association Conference, American Express Business Travel, a global leader in business travel management, released its North America Business Travel Monitor (BTM) data and analysis including domestic and international airfare, hotel rates, and car rental prices paid for the second quarter of 2009.
The Business Travel Monitor, the industry’s pricing benchmark published by eXpert insights, the newly created research arm of Global Advisory Services, revealed that international and domestic airfare prices decreased year-over-year in the second quarter of 2009. Mixed results are seen in hotel rates year-over-year where rates decreased internationally and remained flat domestically. Signs point to corporations continuing to scale back on business travel spend and frequency. In addition, airlines are switching gears and are competing heavily to gain the business of a smaller pool of business travelers.
Highlights of the Q2 BTM included the following:
Q2 Average International Airfares Paid Percent Decreased 19 Percent Year-Over-Year in 2009:
There are several factors which led to the decrease in international airfares paid. One key factor is that companies are employing the cost saving measure of requiring travelers to use of coach class seats instead of business class. In the second quarter, 36% of booked travel was in business class versus 50% in the second quarter of 2008. Another reason for the drop is that airlines are making lower cost fares more available as they compete internationally and deepening corporate discounts on the majority of fare classes in Q2 2009.
Year-Over-Year Average International Airfares Paid in Q2; Q2 09 is
Lowest Rate Since 2005:
Quarterly 2008 and Q1 through Q2 2009 International Average Airfares
Q2 Average Domestic Airfares Paid Decreased 18 Percent Year-Over-Year:
Quarterly 2008 and Q1 through Q2 Domestic Average Airfares Paid:
Average International Booked Hotel Rates Decreased 12 Percent Year-Over-Year,
but Increased 6 Percent from Q1 to Q2
International Average Booked Rates Paid Increased in Q2:
Average Domestic Booked Hotel Rates remained flat Year-Over-Year,
but Decreased 2 Percent from Q1 to Q2:
Domestic Average Booked Rates Paid Decreased slightly in Q2:
Ms. Manning said, “If buyers haven’t looked at hotel rates since the end of last year, now is an ideal time to analyze hotel rate potential savings for 2010 corporate programs. There is an opportunity to secure significant discounts based on continued market pressures, but companies will have to negotiate effectively as hotels compete aggressively for the business buyer and resist further rate drops.”
Car Rental Rates Post Slight Quarterly Decrease of Three Percent
in Q2 2009:
Average daily cost of car rental:
The American Express Business Travel Monitor can also be accessed through a subscription to eXpert Insights, a dedicated research practice within Global Advisory Services, created to help companies cut the costs of business trips dramatically by identifying and implementing best practices and creative strategies within their T&E programs.
About the American Express Business Travel Monitor, North America
The American Express Business Travel Monitor is a key deliverable of American Express Business Travel Global Advisory Services’ Research practice and is a valued component of eXpert Insights which was just recently launched. It benchmarks the average prices for air, hotel, and car rental service by major cities and classes of service through aggregate analysis of American Express' extensive global database of purchase information.
The BTM includes both average published and purchased air fares captured across hundreds of domestic and international routes, including unrestricted first class, business, economy, and discounted, restricted economy air fares. The methodology for the average air fare paid is the one-way price paid by all travelers booked through American Express Business Travel, including taxes and fees, for all routes.
Average booked hotel rates, both international and domestic, represent the total spending of all American Express Business Travel clients, excluding taxes, divided by the total number of room nights confirmed. The full BTM includes hotel averages by major city neighborhoods and category of hotel by price range. The average daily cost for car rentals is drawn from American Express® Corporate Card data and includes all charges incurred, including mileage, gas, tax and insurance, divided by the average length of rental. Data for the distribution of rental class categories is drawn from all rentals booked by the entire American Express Business Travel customer base.
About American Express Business Travel
American Express Business Travel (www.americanexpress.com/businesstravel), a division of American Express Company, is committed to helping its clients maximize the greatest return on their travel investment through increased cost savings, world-class customer service and greater spending control. With clients ranging from small businesses to multinational corporations, American Express Business Travel provides a combination of industry-leading technology, travel management consulting, strategic sourcing and supplier negotiation support, alongside global customer service available online and offline. The Company also provides a dynamic online community (www.BusinessTravelConneXion.com) harnessing the collective intelligence of those in the business travel industry offering a variety of perspectives, best practices, current research and industry news.
American Express operates one of the world’s largest travel agency networks with locations in over 140 countries worldwide. Total travel sales volume in 2008 was $29.1 billion, including proprietary volume, volume processed through joint ventures, and American Express branded volume processed through its partner network.
American Express Company (www.americanexpress.com) is a leading global payments, network and travel company founded in 1850.
American Express Company
|Also See:||Despite Lower Rates, Major Global Hotel Brands Have No Plans to Compromise Service or Scale Back Amenities Consortium of Hotel Industry Leaders Meet on BusinessTravelConneXion.com for Chat; Flexibility, Compliance and Relationship Building Vital to Success in Economic Environment / May 2009|