BELLEVUE, Wash., Oct. 27, 2011 -- Egencia®, an
Expedia, Inc. company, today unveiled its 2012 Corporate Travel
Forecast and Hotel Negotiability Index, finding that airline average
ticket prices (ATPs) and hotel average daily rates (ADRs) for top
corporate travel destinations will be slightly up overall in North America, Europe
and Asia-Pacific. After a year of
decreased negotiability in 2011, Egencia's Hotel Negotiability Index
suggests that corporations will continue to face a weak to moderate
negotiating environment in 2012. Additionally, Egencia surveyed more
than 250 travel buyers in North America
and Europe regarding cost control
measures, travel spend, technology trends and overall expectations for
2012.
Based on Egencia's 2012 Global Corporate Travel Forecast, ATPs
overall for corporate travelers to top business travel destinations are
expected to be:
- Slightly up (4%) in North American destinations
- Slightly up (4%) in European travel destinations
- Slightly to moderately up (6%) in Asia-Pacific
destinations
The hotel environment continues to show signs of year-on-year
growth relative to increased corporate demand, resulting in improved
hotel occupancy worldwide. In key destinations for 2012, Egencia
forecasts average daily rate increases in:
- North America (up 5%)
- Europe (up 2%)
- Asia-Pacific (up 7%)
"With the continued, albeit slow, rise of travel demand,
increased ATPs and ADRs, reduced overall capacity, and fragile economic
outlook, companies are placing an increased focus on mitigating costs
and increasing efficiencies when possible," said Mark Hollyhead, Senior Vice President,
Egencia Americas. "With this in mind, we are taking every measure to
ensure our clients are well informed and leveraging the right tools and
technologies to optimize their travel programs and attain maximum cost
control."
North America Outlook
"Corporate travel experienced moderate growth in 2011 as companies
continued to cautiously reinvest in their travel programs," said Chris Vukelich, Vice President Supplier
Relations, Egencia Americas. "Accordingly, suppliers will likely
implement moderate price increases in 2012, with the potential for
significant increases if fuel costs spike – this will create a
challenging climate for buyer negotiations. For this reason, it is
increasingly beneficial for companies to leverage the negotiating power
of their TMCs to incur the best deals."
ATPs
The current rebound in corporate travel demand will likely continue
into 2012, pushing corporate travel prices upward. Pricing pressures
include an expected ~1.8% GDP growth, increased oil prices that are
expected to remain steady through 2012, fears of continued economic
difficulties, and airlines continuing to tightly manage capacity.
Advance Purchase Advisory
Egencia's Advance Purchase Advisory informs travel managers and
corporate travelers of the best booking timeframe and possible savings
for advance air ticket purchases. The advisory shows that, for the
majority of destinations, business travelers should book 22 days or
more in advance to realize maximum savings. Booking in advance to Toronto, for example, can save as much as
28 percent compared to last-minute bookings. Additional destinations
where the 22 day window nets significant savings are Montreal (26%), Dallas
(24%), Minneapolis (24%) and Calgary (23%).
Charts below illustrate projected year-over-year 2012 vs.
2011 ATP and advanced purchase projections in the local currency in
selected business travel destinations around the world for North
American points of sale.
Average
Ticket Prices
|
|
Market
|
ATP
Delta
Change 2012
|
Advanced
Purchase
Savings
|
|
Atlanta
|
7%
|
21%
|
|
Boston
|
1%
|
13%
|
|
Calgary
|
3%
|
23%
|
|
Chicago
|
3%
|
17%
|
|
Dallas
|
3%
|
24%
|
|
Denver
|
5%
|
18%
|
|
Houston
|
5%
|
27%
|
|
Los
Angeles
|
2%
|
12%
|
|
Minneapolis
|
2%
|
24%
|
|
Montreal
|
7%
|
26%
|
|
New
York
|
6%
|
12%
|
|
Philadelphia
|
8 %
|
20%
|
|
Phoenix
|
0%
|
16%
|
|
San
Diego
|
5%
|
17%
|
|
San
Francisco
|
3%
|
11%
|
|
Seattle
|
2%
|
15%
|
|
Toronto
|
7%
|
28%
|
|
Vancouver
|
5%
|
10%
|
|
Washington
DC
|
3%
|
22%
|
|
London
|
4%
|
11%
|
|
Paris
|
6%
|
11%
|
|
Hong
Kong
|
-7%
|
16%
|
|
Tokyo
|
-2%
|
9%
|
|
|
|
|
|
|
ADRs
In general, average daily rates (ADRs) are forecast to be up
overall in North America, with the
largest increases in San Francisco
(up 15%), Boston (up 10%) and Minneapolis (up 9%). Upward pricing
pressure can be attributed to the trend that new supply growth in the
U.S. and Canada remains slow while
demand has been making a recovery toward 2008/09 levels.
Supply Outlook: Hotel Negotiability
Egencia's Hotel Negotiability Index, an indicator of the overall supply
landscape in top North American cities, suggests that 2012 will
continue to be a seller's market for hotels, although not as widespread
as 2011. The cities with the greatest opportunities for negotiations
are Washington D.C., Calgary and Houston;
while San Francisco, Boston and Minneapolis
will have weak negotiability.
Charts below illustrate projected year-over-year 2012 vs.
2011 ADR and negotiability projections in the local currency in
selected business travel destinations around the world for North
American points of sale.
Average
Daily Rates
|
|
Market
|
ADR
Delta
Change 2012
|
Neg
Index
|
|
Atlanta
|
1%
|
Moderate
|
|
Boston
|
10%
|
Weak
|
|
Calgary
|
-1%
|
Strong
|
|
Chicago
|
7%
|
Moderate
|
|
Dallas
|
0%
|
Strong
|
|
Denver
|
8%
|
Weak
|
|
Houston
|
-1%
|
Strong
|
|
Los
Angeles
|
8%
|
Weak
|
|
Minneapolis
|
9%
|
Weak
|
|
Montreal
|
2%
|
Moderate
|
|
New
York
|
4%
|
Weak
|
|
Philadelphia
|
5%
|
Weak
|
|
Phoenix
|
2%
|
Moderate
|
|
San
Diego
|
2%
|
Moderate
|
|
San
Francisco
|
15%
|
Weak
|
|
Seattle
|
7%
|
Moderate
|
|
Toronto
|
0%
|
Strong
|
|
Vancouver
|
5%
|
Moderate
|
|
Washington
DC
|
-5%
|
Strong
|
|
|
|
|
|
|
Travel Management Trends
Egencia surveyed more than 250 travel buyers in North America and Europe
regarding cost control measures, travel spend, technology trends and
expectations for 2012. According to survey respondents, 42 percent of
North American buyers (percentage is flat year-over-year) and 43
percent of European buyers (versus 23 percent last year) have slightly
or significantly increased travel over the last six months, signaling a
continued rise in overall travel demand.
The top strategies for maintaining or controlling travel costs
in North America include:
- Advanced booking of airline tickets (50% )
- Requiring pre-trip approval (26%)
- Enforcing policy more rigorously (40%)
- Encouraging the use of web conferencing (28%)
Mobile
Mobile devices are becoming increasingly important to today's travel
managers, with 86 percent of North American respondents saying that
mobile devices/functionalities are moderately important to very
important to their travel programs. Respondents identified the
following as the most important uses for mobile technology during
business travel.
- Check flight status (77%)
- Online check-in (77%)
- Urgent destination/flight alerts (60%)
- Review latest itinerary (59%)
Social Media
While mobile device use continues to gain popularity amongst travel
managers and their travelers, social media appears to be a lesser
priority with 71 percent of North American travel managers saying they
do not use social media tools to communicate with their travelers. This
number is anticipated to decrease as mobile and social continue to
become increasingly symbiotic.
Traveler Duty of Care
Over half (52 percent) of European respondents cited they have a formal
traveler duty of care program (security program) in place for their
travelers, compared to only 38 percent in North
America.
Europe Outlook
ATPs
European businesses are slowly increasing travel demand both
domestically and internationally; air prices for corporate travel will
remain slightly up for flights to top business destinations with a few
notable exceptions, including Marseille,
Paris, Frankfurt,
and Milan.
Charts below illustrate projected year-over-year 2012 vs.
2011 ATP and advanced purchase projections in the local currency in
selected business travel destinations around the world for European
points of sale.
Average
Ticket Prices
|
|
Market
List
|
ATP
Delta
Change 2012
|
Advanced
Purchase
Savings
|
|
Amsterdam
|
3%
|
40%
|
|
Barcelona
|
4%
|
30%
|
|
Berlin
|
9%
|
39%
|
|
Brussels
|
4%
|
44%
|
|
Dublin
|
4%
|
31%
|
|
Frankfurt
|
-1%
|
47%
|
|
Glasgow
|
9%
|
21%
|
|
London
|
5%
|
39%
|
|
Lyon
|
2%
|
44%
|
|
Madrid
|
4%
|
41%
|
|
Manchester
|
3%
|
33%
|
|
Marseille
|
-4%
|
45%
|
|
Milan
|
-1%
|
42%
|
|
Moscow
|
8%
|
30%
|
|
Munich
|
8%
|
46%
|
|
Paris
|
-2%
|
44%
|
|
Stockholm
|
0%
|
47%
|
|
Chicago
|
8%
|
19%
|
|
Los
Angeles
|
11%
|
11%
|
|
New
York
|
15%
|
16%
|
|
San
Francisco
|
9%
|
19%
|
|
|
|
|
|
|
ADRs
In general, average daily rates (ADRs) are forecast to be
slightly up overall in Europe, with
the largest increases in Moscow (up
9%) and Stockholm (up 8%) leading the
way. Other cities are showing flat to slight ADR growth, including Berlin (flat), and Paris (up 2%).
Charts below illustrate projected year-over-year 2012 vs.
2011 ADR and negotiability projections in the local currency in
selected business travel destinations around the world for European
points of sale.
Average
Daily Rates
|
|
Market
List
|
ADR
Delta
Change 2012
|
Neg
Index
|
|
Amsterdam
|
-2%
|
Strong
|
|
Barcelona
|
2%
|
Moderate
|
|
Berlin
|
0%
|
Moderate
|
|
Brussels
|
0%
|
Moderate
|
|
Dublin
|
2%
|
Weak
|
|
Frankfurt
|
-2%
|
Strong
|
|
Glasgow
|
4%
|
Moderate
|
|
London
|
2%
|
Weak
|
|
Lyon
|
-3%
|
Strong
|
|
Madrid
|
2%
|
Moderate
|
|
Manchester
|
1%
|
Moderate
|
|
Marseille
|
2%
|
Moderate
|
|
Milan
|
-2%
|
Strong
|
|
Moscow
|
9%
|
Weak
|
|
Munich
|
3%
|
Moderate
|
|
Paris
|
2%
|
Moderate
|
|
Stockholm
|
8%
|
Weak
|
|
|
|
|
|
|
APAC Outlook
ATPs
ATPs for APAC are likely to increase in almost every destination we
analyzed, signifying growth for the region. Some markets are forecasted
to show only slight increases, due primarily to the rising costs of oil
and increased taxes.
Charts below illustrate projected year-over-year 2012 vs.
2011 ATP and advanced purchase projections in the local currency in
selected business travel destinations around the world for Asia-Pacific points of sale.
Average
Ticket Prices
|
|
Market
|
ATP
Delta
Change 2012
|
Advanced
Purchase
Savings
|
|
Bangkok
|
11%
|
7%
|
|
Beijing
|
9%
|
20%
|
|
Dehli
|
8%
|
13%
|
|
Hong
Kong
|
6%
|
14%
|
|
Jakarta
|
15%
|
3%
|
|
Manila
|
4%
|
4%
|
|
Melbourne
|
2%
|
18%
|
|
Mumbai
|
13%
|
18%
|
|
Seoul
|
-4%
|
14%
|
|
Shanghai
|
2%
|
19%
|
|
Singapore
|
9%
|
8%
|
|
Sydney
|
0%
|
11%
|
|
Taipei
|
3%
|
11%
|
|
Tokyo
|
3%
|
13%
|
|
London
|
10%
|
2%
|
|
Los
Angeles
|
8%
|
11%
|
|
New
York
|
10%
|
9%
|
|
Paris
|
7%
|
5%
|
|
San
Francisco
|
4%
|
10%
|
|
|
|
|
|
|
ADRs
Supply in the region is currently limited in relation to the
demand, impacting the flexibility of negotiating corporate rates.
However, new supply growth in APAC is stronger than the rest of the
world and is now catching up to demand growth. Asia-Pacific ADRs are up
overall year-over-year, showing particularly strong growth in Hong Kong (up 15%) and Singapore (up 11%).
Charts below illustrate projected year-over-year 2012 vs.
2011 ADR and negotiability projections in the local currency in
selected business travel destinations around the world for Asia-Pacific points of sale.
Average
Daily Rates
|
|
Market
|
ADR
Delta
Change 2012
|
Neg
Index
|
|
Bangkok
|
3%
|
Moderate
|
|
Beijing
|
3%
|
Moderate
|
|
Dehli
|
-1%
|
Strong
|
|
Hong
Kong
|
15%
|
Weak
|
|
Jakarta
|
3%
|
Moderate
|
|
Manila
|
-4%
|
Strong
|
|
Melbourne
|
5%
|
Moderate
|
|
Mumbai
|
-1%
|
Strong
|
|
Seoul
|
3%
|
Moderate
|
|
Shanghai
|
-6%
|
Strong
|
|
Singapore
|
11%
|
Weak
|
|
Sydney
|
7%
|
Weak
|
|
Taipei
|
5%
|
Moderate
|
|
Tokyo
|
-2%
|
Strong
|
|
|
|
|
|
|
For more details, you can download the full 2012 Corporate
Travel Forecast and Hotel Negotiability Index, including considerations
for travel buyers here: http://www.egencia.com/daily/home/docs/2012_Travel_Forecast_US_Final.pdf
Research Methodology
Data and insight based on the statistical analysis of the past and
present industry trends, macroeconomic factors, market research and
vendors' capacity forecasts for 2012. Smith Travel Research (STR) and
OAG filings were leveraged for a market-level analysis of both Lodging
and Air capacity. ARC, STR and Egencia Internal Data were used for
market-level analysis of pricing.
Disclaimer
This data refers to business destinations and business travel pricing.
These projections are based on Egencia analysis of data from OAG, ARC,
STR and Expedia, Inc. The forecast represents an opinion based on
current market factors and is not a representation or warranty as to
the accuracy of the forecasts or projections made herein. Actual
changes in ticket prices and hotel rates could vary significantly from
forecasted numbers, impacted by unforeseen future economic and
political factors.
About Egencia, an Expedia, Inc. Company
Egencia is the fifth largest travel management company in the world. As
part of Expedia, Inc., (NASDAQ: EXPE), the world's largest travel marketplace,
Egencia helps businesses get ahead by offering the only truly
integrated corporate travel service. Egencia's industry expertise helps
drive results that matter, delivering meaningful advancements that have
a real impact. By combining a powerful offline and online service,
Egencia delivers a complete corporate travel offering supported by
global market expertise and a best-in-class technology platform.
For more information, go to www.egencia.com.
Egencia and the Egencia logo are either registered trademarks
or trademarks of Expedia, Inc. in the U.S. and/or other countries. All
other trademarks are the property of their respective owners.©
2011 Egencia, LLC. All rights reserved. CST # 2083922-50
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