Dive Brief:
- Global business travel and event prices will moderate for the rest of this year and into 2025, according to the Global Business Travel Association and CWT’s 2025 Global Business Travel Forecast.
- For hotels specifically, average daily rates are cooling worldwide. Going into 2025, the report forecasts smaller ADR increases in the North America region as leisure demand softens.
- According to CWT President and CEO Patrick Andersen, the report’s findings suggest “a period of relative stability is on the horizon” after years of travel cost volatility. Businesses can expect “a more predictable pricing environment through 2024 and 2025,” he said.
Dive Insight:
The report forecasts global ADR to rise 2.5% to $162 in 2024 and 1.9% to $165 in 2025. Following a 30% rise in 2022, global ADR rose 3.9% to $158 in 2023.
PwC attributed decelerating hotel performance growth to economic headwinds and geopolitical tensions in November. In May, the professional services company noted that hotels in the U.S. specifically would still see marginal economic gains despite those challenges.
Meanwhile, the meetings and events sector has “rebounded strongly,” the Global Business Travel Forecast said, amid “heightened demand for in-person engagements.”
In 2023, the average daily cost for attendees dipped 3.1% due to a “shift in types of meetings being held.” Going forward, however, the forecast anticipates that the average daily cost per attendee will grow 4.5% in 2024, and an additional 4.3% in 2025.
In the U.S., hotels are benefitting from “healthy” group and business travel, according to Knowland and Amadeus’ Hospitality Group and Business Performance Index. And in a second quarter earnings call in July, Marriott International CEO Anthony Capuano said group travel was the hotel company’s “strongest” segment.
GBTA CEO Suzanne Neufang, however, warned that “businesses should remain vigilant to evolving pricing dynamics influenced by global trends.”
“The next few years will require a strategic approach that balances cost management with sustainability, innovation, and responsiveness to market changes,” she added, in a statement.
