Travel prices are expected to rise sharply in 2019, driven by a growing global economy and rising oil prices

Travel prices are expected to rise sharply in 2019, with hotels going up 3.7%, and flights 2.6%, driven by a growing global economy and rising oil prices, according to the fifth annual Global Travel Forecast, published this week by the Global Business Travel Association (GBTA) and Carlson Wagonlit Travel (CWT) with the support of the Carlson Family Foundation.


  • Travel prices are expected to rise sharply in 2019 according to the fifth annual Global Travel Forecast, published by the Global Business Travel Association (GBTA) and Carlson Wagonlit Travel (CWT);
  • Air prices are expected to increase +2.6% globally – fuel costs are on the rise – but continued growth in capacity should help keep major price increases in check;
  • Hotel rates are expected to rise +3.7% globally as economic growth and solid business travel demand spur price increases;
  • Despite ride-sharing growth and oversupply of rental fleets, rental cars remain important part of managed travel programmes; prices will rise +0.6% globally.

The report from GBTA, the voice of the global business travel industry, and CWT, the global travel management specialist, looks ahead into 2019 and shows the trends and developments that will shape the business travel industry. While most major markets appear to be trending in the right direction, downside risks remain for the global economy given “the rise of protectionist policies, the risk of stoking trade wars and Brexit uncertainty,” says Michael W McCormick, GBTA executive director and COO.

The forecast provides travel buyers with a better understanding of the global market and key price drivers and more than ever highlights the importance to keep a watchful eye on developments and in turn quickly react to the ever-changing global landscape. “Prices are expected to spike in many global markets even as inflation remains subdued,” warns Kurt Ekert, president and CEO of CWT.

The projections in the 2019 Global Travel Price Forecast are based on a statistical model, developed by GBTA with market and economic research firm, Rockport Analytics, that evaluates historical price behaviour and forecasts future price references. It also incorporates market-specific expertise and travel industry knowledge of CWT and CWT Solutions Group personnel worldwide and information sourced from Moody’s Analytics, the International Monetary Fund Research Department, the United Nations and other leading organisations.

Projections are based on transaction data from CWT’s global client portfolio, including anonymized client travel patterns, over the past seven years. Key macroeconomic and per-country indicators, such as current and expected GDP growth, the consumer price index, unemployment rates and crude oil prices, are used in the statistical model, as well as key supply-side drivers sourced from OAG and STR Global.

2019 Air Projections

The report suggests the aviation sector will be shaped by the introduction of ultra long haul flights and an increasing competition from the low cost carriers, which are not only multiplying but also fighting for long haul routes – and by the airlines’ push towards NDC. It says airfares are “likely to become more expensive” due to rising oil prices, the competitive pressure from the shortage of pilots, potential trade wars and increasing fare segmentation to improve yield.

By region it forecasts Asia Pacific prices to see a +3.2% rise in 2019 with strong growth throughout – stand out markets are China (+3.9%) New Zealand (+7.5%) and India (+7.3%). The only exception in this booming region being Japan where it predicts prices to drop -3.9% due to the country’s added capacity in preparation for the Olympic Games in 2020. Western Europe is expected to see the highest rise at +4.8%, while North America will see modest +1.8% price rises. Elsewhere, the Middle East and Africa and Latin America will see -2.0% price declines and Eastern Europe a -2.3% fall.

2019 Hotel Projections

The growth in air travel will drive the hotel outlook for 2019, according to the report, and fuel demand for rooms. Technology will also play an important part, it adds, as hotels are introduce new developments to personalise the guest experience. The increase of mobile penetration, on the other hand, is forcing travel managers to offer their travellers apps, which also serve to accommodate greater in-policy booking autonomy, it explains.

The report predicts further mergers and greater competition between upscale and midscale hotels due in part to a “growing appetite for boutique accommodation among younger travellers”.

Again Western Europe will see the highest level of price rises at +5.6% ahead of Asia Pacific at +5.1% (and buoyed by a significant +11.8% rise in New Zealand). In North America prices will rise +2.1% with rates growing faster in Canada than USA, while Latin America they will fall -1.3% with notable declines in Argentina, Venezuela, Brazil and Colombia offsetting rises in Chile (a notable +6.4%), Peru and Mexico. Declines will also be recorded in Eastern Europe (-1.9%) and the Middle East and Africa (-1.5%).

2019 Ground Transportation Projections

Next year, ground transportation pricing is expected to rise only 0.6% globally, says the report, but by the fourth quarter of 2019 it expects us to see “a concerted effort by rental companies to raise prices”. The year will also see a “growing preference among travellers” for ride-hailing apps, while interest in high-speed trains will fade due to high network costs and low-tech distribution systems. Mobile mobility will rise though, says the report. On-demand, shared, electric and connected cars will all become more popular with connected car technology holding “the potential to change the entire automotive industry”.

Looking at a regional level in Asia Pacific, markets like New Zealand (+4%), India (+2.7%) and Australia (+2.4%) will see increases. In Europe, Middle East & Africa, countries like Finland, France, Germany, Italy and Spain will see increases of over +4%, while Denmark and UK rates will grow +3% and +2% respectively. Norway will be in pole position with a +10% increase. On the downside, prices will drop dramatically in Sweden (-13.9% down) and very slightly in Belgium (-0.9% down).

The study highlights that prices in Latin America will show strong decreases in Argentina (-9.7% down) and Brazil (-5.4% down) and a more moderate one in Mexico (-0.3%), but Chilean prices will be up +3.1%. In North America, Canada is expected to see a +3.6% increase in 2019, and the United States a +1.0% increase.

“The future of corporate travel can be summed up as accelerated personalization – with mobile technology, AI, machine learning and predictive analytics all playing their part,” says Mr Ekert. “Success is tied to technology, with sophisticated data-crunching at the very heart of it.”

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