NBTA survey forecasts 9% rise in biz travel costs for 2006

The National Business Travel Association (NBTA) is forecasting that travel management costs for U.S. corporations will rise an average of 9% next year, though it said most travel components, such as hotel and car rental rates, will rise by smaller amounts than the average.

In its 2006 forecast, the NBTA said travel managers expect the higher costs to result from a combination of higher prices as well as an increased number of trips.

The forecast is based on an online survey of 130 corporate travel managers, two- thirds of whom said they anticipate an increase in fares and rates of up to 10%. Another 8% said they expect even higher increases, while about 9% said they expect a decrease. Just under 17% expect no change.

As for specific travel components, the consensus estimate is for increases that range from 4% to 9% in air, hotel, car rental and meal expenses.

Ordinarily that would produce an average cost increase of less than 9%, but the NBTA said the average is also affected by additional considerations such as technology expenditures and employment benefits. 

The survey of corporate travel managers also revealed that the use of online booking tools has risen to 70%, while another 10% plan to begin using one in the next six months. Only about 6% said they have no plans to use an online tool.

Without offering a percentage figure, the NBTA said it has seen a significant rise in  interest in the corporate travel offerings of the giant Internet travel distributors such as Expedia, Travelocity and Orbitz. It said travel managers report quicker adoption rates with tools offered by the online giants, because users tend to be already familiar with them.

In other findings:

  • A majority of travel managers, about 60%, estimated their average daily room rate at about $75.

  • For car rentals, most managers, 63%, estimated their average daily rate between $30 and $45.

  • About half of survey respondents said they had 50 or fewer preferred hotels; for car rentals, nearly 39% said they had one preferred vendor, and 51% had two.

  • The overwhelming majority, nearly 94%, reported a clear trend of shifting hotel bookings away from the luxury category toward midlevel accommodations.
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