Global business travel costs, which have surged in recent years, are predicted to moderate in 2025, with only modest increases on the horizon, according to a new industry forecast.
This outlook, presented in a global business travel report from travel management company CWT and the Global Business Travel Association (GBTA), suggests that while expenses will still rise, the pace of growth will slow significantly through 2024 and into 2025.
A Slower Climb in Travel Costs
The forecast highlights that, after years of dramatic price hikes, the market is entering a period of stabilization. This suggests that the economic factors driving these increases are easing, allowing for a more balanced trajectory in the near future.
CWT president Patrick Andersen shared optimism about the outlook: “The past few years have seen a lot of volatility in travel costs, but the data points to a coming period of relative stability. Companies should be able to better predict travel expenses through 2024 and 2025, which will aid in more efficient budget planning and cost control.”
However, Andersen warned that the situation remains delicate. “Price stability is still vulnerable to external factors like geopolitical tensions, inflationary pressure, and environmental, social, and governance (ESG) concerns,” he added.
Strategic Planning and Market Trends
GBTA’s chief executive Suzanne Neufang echoed these sentiments, emphasizing that although businesses can expect more predictability in travel costs, they must remain adaptable. “The research indicates a more stable period for travel prices is likely, but companies need to stay alert to shifting dynamics driven by global trends,” she said.
Neufang highlighted the importance of maintaining a strategic approach that balances cost control with considerations of sustainability, innovation, and market responsiveness.
Airline and Hotel Costs: Forecast for 2024 and 2025
The report provides detailed projections on both airfare and hotel costs. Global average airline ticket prices are expected to rise by 1.9% this year to $701, with a modest increase to $705 in 2025.
In the Europe, Middle East, and Africa (EMEA) region, ticket prices are anticipated to rise to $797 in 2024 and $808 in 2025, reflecting a moderate growth trajectory amid ongoing inflationary pressures.
Hotel rates are also projected to see continued but tempered growth. The global average daily room rate (ADR) climbed 3.9% in 2023, reaching $158, following a sharp 30% rise in 2022. Occupancy levels have recovered to pre-pandemic levels in some regions, though the limited supply of new hotels will continue to exert upward pressure on prices.
The forecast predicts the global ADR will rise by 2.5% to $162 in 2024, followed by an additional increase of 1.9% to $165 in 2025.
The Road Ahead for Business Travel
Despite the cooling pace of cost increases, both Andersen and Neufang caution that businesses must stay prepared for potential market fluctuations. The combination of inflation, global instability, and sustainability considerations could still disrupt the relatively predictable environment predicted for 2024 and 2025.
Businesses that take a proactive, flexible approach—balancing cost management with broader strategic objectives—will be better positioned to navigate the shifting business travel landscape.
