Hotel rates in major business destinations have increased over the past year reversing last year’s decline, according to Egencia.
Compared with the first three months of 2010, average daily rates in Europe’s primary destinations are up. Paris leads the way, with average daily rates (ADRs) 10% ahead of the Q1 2010.London is 9% ahead, the same increase as Munich, Frankfurt and Amsterdam.
In the US, all destinations are up with San Francisco and Dallas topping the charts with 17% and 10% increases respectively.
“The increase in ADRs can be attributed to the return of corporate demand, reduced scale of new supply, improved occupancy, and higher air capacity,” the report said.
For air, the picture is more complex, according to the report. On the one hand, fuel prices and local taxes are driving prices up. On the other, low-cost carriers and high-speed rail are forcing airlines to drop prices in order to compete.
In Europe, the UK and German governments’ decisions to increase air taxes is blamed for pushing up the average ticket price (ATP). From Eugenia’s European points of sale, ATPs for intra-European destinations decreased 4% year-on-year, compared with North American destinations which were 8% ahead.
From its US points of sale, seats within North America were 13% ahead and 1% up for Europe.
The study also offered a snapshot of what travel buyers are thinking. For 2011, not surprisingly, the main focus for buyers is cost control and reducing spend. Nearly four in five see this as a challenge during the year. Nearly half the sample also said that “having a full view of the total travel spend” would prove challenging.
Jonny Shingles, Managing Director, Egencia UK, said: "Our proprietary solution enables us to have access to data very easily and to pass them on to our clients via our annual studies which clearly reflect industry trends."
The paper can be downloaded free of charge from Egencia’s web site. Click here to go directly to the request page.