According to the American Express Global Business Travel Forecast, business hotel and air travel rates should increase over the next year. The good news is that those rates should only increase by between one and six percent in North America, and well below the projected increases in the costs of goods and services in the U.S.
The AMEX spokesperson attributed these higher costs to higher demand, economic improvement, and impacted capacity. Obviously, these are all are hallmarks of an improving economy, and can be expected to negatively impact business travel costs in the coming years.
Digging deeper, part of the reasons hotel rates will increase is due to the considerable discounts offered to business travelers in the past year. With increased revenues, companies will now be looking to pay a little more to upgrade lodgings. Also, new hotel building has slowed to a crawl, reducing the amount of available beds, relatively
speaking. For these reasons, AMEX expects to see upper range business lodgings enjoy a higher occupancy rate than mid-range business lodgings as expressed as a percentage increase from the previous year.
If AMEX’ s forecast is correct, business travel procurement experts might be well served to explore their options in San Diego corporate housing when arranging business travel to Southern California. Corporate housing can often offer better rates than business hotels while presenting superior amenities.