Just when you thought you had your 2025 travel budget figured out, new data from FCM Consulting's 2024 Q3 Travel Report might make you want to reach for your calculator. Here's why: As business class fares soar and planes fill up, travel managers are facing a tough debate over rising costs.
“Our data tells two stories,” says Bonnie Smith, general manager of FCM South Africa. “Yes, travel is becoming more expensive, but it is also becoming more predictable. Travel managers are saving money on flights and getting cheaper hotel rates by booking in advance. Travel The opportunity to be strategic with your spending has never been greater.”
Here's what to expect for corporate travel in 2025.
The sky is getting crowded
Remember the ghost town airports of 2020? Those days are long gone. The flight was fully booked, with a load factor of 86.2%. Global passenger demand increased by 8.6% in August 2024 compared to 2023. Yes, business class ticket prices will be 6-8% higher compared to 2023, but there is good news. Economy fares fell by 1-4% compared to 2023. .
What this means for you in 2025: If you've been putting off booking a meeting with an important client in London, New York or Dubai, now's the time to put it in your diary. Gone are the days of “last minute rallies.” These days, you can get a window seat (and better fare) if you get up early.
The Hotel Squeeze
If you're wondering why hotel prices in Joburg have gone up a bit lately, you're not alone. Room rates are up 14%, and if you think that's an eye-opener, think about your colleagues heading to New York who are looking at $490 a night (up 15%). Average room rates are increasing in North America (6.8%), South America (25.4%), and Europe (5.3%), with prices softening modestly in the Middle East/Africa, Asia, and Australia.
What this means for you in 2025: It's time to learn more about your accommodation options. Your usual Manhattan hotel may need to be reconsidered, but remember that location isn't everything. Some of the best business hotels are just a short drive from the city center and are often well-equipped for productive work.
money is important
This is where it gets interesting for international business planning. Global inflation is (finally!) calming down, but prices are still rising in some regions such as Brazil and India. The good news? Your rand works harder in some markets than others.
What this means for you in 2025: Be strategic about when and where you send your team. If you plan to expand your business, take these regional cost differences into account. In some cases, it may be better to combine multiple meetings into one trip. Please decide according to your budget.
Good news about 2025
Airlines are promising more seats in 2025 (up 1.8% in the first half of this year, 2.1% in Africa), but no champagne yet. More seating doesn't automatically mean cheaper fares, especially if everyone wants to limit in-person meetings.
What this means for you in 2025: Stay tuned for new route announcements. Often accompanied by decent corporate deals. If you're managing a travel program, now is the time to really get to know your airline representatives or work with your TMC. These efforts and relationships are worth it in air miles.
The companies that win the travel game aren't necessarily the ones with the biggest budgets. It's a smart company with its budget, Smith said, highlighting TMC's role in optimizing cost and value. Smith advises companies to leverage TMC's expertise in several key areas.
“TMC’s AI tools analyze customers’ travel patterns and suggest cost-saving opportunities they might otherwise miss, such as booking premium economy instead of business class on short-haul routes where the price difference outweighs the benefits. I will.”
She also emphasizes the power of integrated purchasing. “A good TMC brings bargaining power that no one can match on their own. We book thousands of stays and flights, which means better rates and more flexible terms for our customers. ”
Smith said: “Success in 2025 isn’t just about controlling costs; it’s about making travel less burdensome for your company. Whether it’s through better planning, smarter technology, or having the right support team in place. You get the most value out of your trip.”
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