While corporate average room rates have ‘plateaued’ in H1 2023, global airfares are set to increase between 3 pc and 7 pc in 2024, driven in part by inflation, says data from FCM.

Global travel costs have stabilised and business travel volumes and budgets are poised to increase in 2024, as per FCM Consulting’s Global Quarterly Trend Report.

According to the report, based on FCM’s corporate booking data from July through to September, global airfares will increase between 3 pc and 7 pc next year compared with this year, driven in part by inflation. 

The report adds that North American carriers are showing aggressive growth for airline seat capacity next year, which is expected to be 8 pc higher than 2019 levels. Meanwhile, in Europe, regional seat capacity is expected to be 2 pc lower than pre-pandemic levels, but between 5 pc and 7 pc higher than 2023 levels.

In accommodation, FCM reports that corporate average room rates have “plateaued” over the past six months. In Europe, corporate rates declined 2 pc in the third quarter compared with the previous quarter, with some of the largest declines in Germany capital Berlin, down 5 pc while Spanish capital Madrid was down 2 pc. Rates in gateway cities such as Amsterdam in the Netherlands, Frankfurt and London remained flat over the period, while Irish capital Dublin saw an increase of 4 pc.

The statement adds that car rental rates this year are up 4 pc globally compared with 2022, though rates in the Netherlands, the US and Australia are down 1 pc, as per FCM’s report. Next year, those increases should moderate to a 2 pc to 3 pc increase year over year.

With overall travel demand growing at a more moderate pace than the earlier stages of the post-pandemic recovery, and prices stabilising, “the data suggests that travel budgets and business travel will again increase in 2024, pending economic conditions and geopolitical issues,” according to FCM.