Key points on how inflation has impacted the business travel industry
- After experiencing a +50% YoY (year-on-year) peak in the middle of 2022, prices have dropped to an increase of +26% YoY at present. The chaos the business travel industry experienced in 2022 is now stabilizing.
- After record highs in spring and summer 2022 (Q2/Q3), business travel inflation is slowly decreasing in Q4/2022, with a quarterly reduction of -8% QoQ (quarter-on-quarter).
- Lodging and flight prices reached record highs in comparison to 2021, with an 60.2% YoY increase in the second and third quarter of 2022, respectively.
- However, contrary to airfare and hotel prices, car rental prices are still increasing in Q4/2022, by +5.5% QoQ.
- Corporate travel prices are currently 20% higher than pre-pandemic levels on average (compared to the last quarter of 2019).
- Prices are expected to continue rising in 2023.
The global view: Prices are stabilizing after a record high in spring and summer 2022
As you can see, the spring and summer of 2022 were chaotic. Prices peaked by nearly +50% in comparison to 2021 (the blue column).After these record highs, however, business travel fares are now slowly going down and stabilizing, with an almost -8% QoQ (quarter-on-quarter) decrease (the orange column). Otherwise said, the chaos the industry experienced earlier this year has been normalizing ahead of the year’s end.If you look at the data from 2022 vs 2019 (the red column), things are looking more stable overall, but increases are still significant, ranging from 12.4% (in Q1) to 24.3% (in Q3). At the moment, corporate travel prices are approximately +20% higher than in 2019 and are expected to continue growing into 2023.The Global Business Travel Association (GBTA) is expecting the global business travel spending to reach pre-pandemic levels and a full recovery around 2026.