Travel costs in 2024 should increase year-over-year, but not at the “torrid” rate seen in the previous two years, according to Altour’s 2024 Industry Forecast.
Airline, hotel and car rental prices around the world are all “stabilising” this year as leisure travel returns to pre-pandemic levels, according to the travel management company Height. In addition, capacity in travel segments is beginning to meet or exceed demand.
For air travel, Altour projects that transatlantic fares between the United States and Europe will increase by 2 to 5 percent this year. Meanwhile, US domestic airfares are expected to increase by 2-4 percent year over year.
“When it comes to airlines, there are already signs that capacity and demand are equal, which should lead to a small increase in air prices, or even a decrease in some parts of the world,” Altour added in the their report.
“Some air fares could decrease over the year, driven by the decline in ticket prices in the Asia-Pacific region from 2023 when there was strong demand and limited flight capacity.”
Similarly, Altour predicts an overall increase in the average hotel rate of 2 to 5 percent year-on-year by 2024, but the TMC indicated that there will be “large fluctuations” between types of hotels and markets in the world.
Cities that serve a mix of business, leisure and group customers, including Chicago, London, Los Angeles, New York and Paris, are projected to see hotel prices rise above average, particularly among properties of higher level.
Meanwhile, lower-tier properties have become more dependent on corporate business as subsidies from the leisure travel boom and have had to raise limited rates. Altour said his team has negotiated rate reductions of up to 10 percent with some hotels in this tier.
Average daily car rental rates are expected to increase by 3 to 4 percent in 2024, according to the forecast. Altour said that while supply chain issues have improved for car rental companies, high labor costs, vehicle purchase prices and inflation are still on the rise.
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