Air fares are on an upward trend and look set to hit an all-time high
High oil prices will not greatly impact business travel, according to the Global Business Travel Association Foundation. Its new report “What does triple-digit oil mean for business travel?” says that a short-term rise in oil prices between now and 2013, even one that reaches as high as $200 a barrel, would cut business travel spending by only 2.5% ($9 billion or 2.7 million trips). If oil hits $125 a barrel, business travel budgets will reduce by only 1.5% ($5.8 billion or 700,000 trips) over the next two years.
Meanwhile, American Express’ Business Travel Monitor report says that air fares increased by 7% in 2010, leaving them only 6% more to cover before they reach their previous all-time high in 2008. “Increases in airfares are likely to remain on an upward trend in 2011,” says the director of research for Global Advisory Services, the research arm of American Express. “So far this year, we are seeing this trend hold true with domestic airfare rates in January up 8% compared to January, 2010.”
[pictured: Kingfisher Class in-flight entertainment]