Predictions for 2013


Steve GlennEvery January for the past 10 years, I have sent predictions to my clients about what I think will be happening in travel over the coming year. So far, my record is 74% accurate. Here's a sampling of what I think we'll see in 2013:

Airlines will charge extra for using a credit card: Airlines pay anywhere from 2% to 4% of the cost of an airline ticket to credit card companies when a ticket is charged. Some airlines are already charging a fee for credit card use in Europe. As airlines continue to consolidate and flex their muscles, I expect to see a processing fee. This will be worth billions to the airlines. It will happen; the question is, when?

More airlines will charge for carry-on bags: Airlines have become addicted to ancillary fees and will keep pushing the envelope with the introduction of fees to carry aboard anything more than a purse or laptop.

American Airlines and US Airways will merge: The new airline will be called American, but the management will be US Airways-heavy.

Southwest Airlines will start charging a fee to change tickets: The airline said it plans to raise an additional $100 million in fees in 2013, and they say they will charge a fee for no-shows. They have not said how they will collect a no-show fee, but my guess is that they will charge a $100 fee to change a ticket if you did not show up for a flight. The net result is the same as charging a change fee.

We will see the death of the $198 roundtrip airfare: The airlines are on a roll. In 2010 they were able to raise fares as much as 20% in some markets. In 2011 the airlines cut routes and added more and more surcharges. In 2012 the airlines continued to focus on profit over market share. In 2013, instead of paying $198 roundtrip to see Grandma, you are more likely to see fares in the $398-$498 range. Consolidation means higher airfares, and every carrier that disappears contributes pricing power to the survivors.

Cigars anyone? Cuba will be opened to American travelers: 2013 will be the year the U.S. breaks its own political blockade and allows U.S. citizens to tour our southern neighbor. Cruise ships will immediately make Cuba a new port of call.

The Internal Revenue Service will decrease the vehicle reimbursement rate to 50 cents a mile: The IRS will respond quickly as the price of gas continues to drop by reducing the allowable vehicle reimbursement rate for business travel.

A passport will soon be required to graduate from college: We're in a global economy that requires travel and knowledge of the world to be successful in business. Colleges will mandate international travel as part of their curriculum, and a passport will replace the driver's license as identification for business travelers.

Four out of 10 hotel rooms will go empty: Despite the hospitality industry's claim that the recession is over and that prices are rebounding, almost 40% of hotel rooms will be empty in 2013. Obviously some markets like New York and other metropolitan areas will see double-digit growth because of limited inventory, but in many areas of the world, hotels will continue to offer very attractive rates.

Missing a connecting flight could keep you stranded in an airport for up to four days: With airlines flying their planes 90% full, they have fewer seats available if a flight is canceled or delayed. Put a major storm into the mix, and missing a connecting flight in 2013 might mean you're sitting in the airport on a waitlist for as long as two to four days. Pay a little extra and book a direct flight to reduce the risk.

Companies will tell employees to "carry-on" and will stop reimbursing for baggage fees: Checking two bags on a business trip can add as much as $100 to the cost. Companies will be monitoring this closely in 2013, and some will change their travel policies so that on trips of three nights or less, the company will not reimburse for baggage fees.

Airlines will simply stop answering the phone during a blizzard: Want to try to reach an airline during a massive blizzard? Good luck! The airlines are staffed to handle normal call volumes. Throw in a snowstorm that cancels 10,000 flights, and you will have better luck calling the moon than the airlines.

Business travelers will move back to the Marriott from the Hampton Inn: Business travelers across the globe were told in 2009 to lower their travel costs by using less costly hotels. This means they traded the $150-per-night Marriott to stay at the $90-per-night Hampton Inn. As the economy improves in 2013, many businesses will once again start allowing employees to step up one star.

Airplanes will become shopping malls in the sky: Airlines this year will start selling more products to passengers. The airlines will offer in-flight vacation deals that enable passengers to buy airline seats and resort packages to exotic destinations at prices not available anywhere else. They will also use the WiFi systems to market new products.

All-inclusive resorts will be launched in Hawaii and the U.S.: While there are a few (very few) all-inclusives on the U.S. mainland and Hawaii, I predict that in 2013 you will start to see more properties in Hawaii and in the continental U.S. offer all-inclusive pricing.

Airfares to Europe will continue to shock you this summer: Three years ago you could fly to Europe during the winter months for as low as $500. Last year those same airfares were almost 50% higher. Summer airfares that were $1,300 roundtrip last year will be $1,500 or more in 2013. I predict those on a budget will begin to find the cheapest airfare to a major European city and then take a European low-fare carrier to the final destination.

Alaska cruises will be selling fast: The prices of Alaskan cruises will continue to rise in 2013. Your best bets will be to book early and look for deals during the shoulder months of May and September.

"Bleisure" trips offer two-for-one experiences: Bleisure travel is the mixing of business and leisure. More and more business travelers will leverage their business trips by taking their spouse and extending trips by a couple of days.

Italy, Ireland, Germany, France and Greece will continue to be top European destinations: Americans can't get enough of Europe, especially these five. Even with a weak dollar, the hotels in Europe will be offering great deals.

European vacations will become longer: As airfares increase dramatically to international destinations, people will extend European trips to get the most out of the higher cost of airline tickets. That 10-day trip to Europe may now expand to 12 to 14 days.

Credit cards will start charging a fee to convert points to miles: Credit card companies will start charging $1 per 1,000 points to convert points into miles.

Frequent flyer miles will become almost impossible to redeem later this year: The window to maximize frequent flyer miles is closing fast. It will become harder and harder to find empty seats to redeem frequent flyer miles. And if you do find something, expect to pay some sort of redemption-related fee(s).

Comfort and safety will be king: The glitz, glamour and stress related to business travel will lead people to search in 2013 for the security of days gone by. Travelers will still be searching for contemporary design, but ones that are practical, comfortable and warm. Safety and security will be high on travelers' lists.

The University of Nebraska's football team will win the Big 10 football championship. The Cornhuskers will bring back the winning tradition that made us the "Big Red." Well, hope springs eternal.

Steve Glenn is CEO and chairman of Executive Travel, a BCD affiliate in Lincoln, Neb.


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