Long-haul airfares from the UK are expected to increase next year, according to research from American Express Global Business Travel.
The TMC is forecasting that long-haul economy fares from the UK will rise by up to 3 per cent in 2015, while business class fares could increase by up to 2 per cent.
But Amex is expecting short-haul business class fares from the UK to fall by between 2 and 5 per cent, while economy fares are likely to be more stable, although they could drop by as much as 2 per cent. The TMC said these prices would be kept lower due to competition from no-frills carriers.
Amex said that UK hotel rates were also set to go up with mid-range properties charging 4 to 6 per cent more than in 2014, while upmarket hotels would be increasing rates by 3 to 6 per cent.
“Despite low economic growth across Europe, the UK is a bright spot for the region, with strong country-level financials and expectations for continued growth next year,” said Amex in its 2015 Forecast.
“However, as the UK economy stabilises, the cost of corporate travel may also rebound.
“The Forecast predicts that airline capacity in the UK will remain constrained as airlines manage inventory as closely as possible, which will continue to drive up prices.”
Hotel rates in the UK are predicted to rise with the “strong increases” expected in London, followed by Edinburgh, Leeds and Cardiff.
“These locations are expected to become stronger and more consistent, with steady demand and new properties being built, particularly in the south of London,” said Amex.
Caroline Strachan, Amex’s vice president of global business consulting EMEA, added: “UK hotel rates continue to rise and London has been maintaining its rates after hosting a number of international events.
“However, many corporations have cut back on spending and hotels may not get the prices they are setting. Nevertheless, the economic recovery in the UK is a welcome boost to the business travel industry.”
Amex said that European airfares were likely to “remain neutral” in 2015, although extra transatlantic capacity could reduce fares on some of these routes.
European hotel rates are predicted to rise slightly across the region and Amex warned that some European cites were likely to “add higher hotel-related taxes for travellers, making it more difficult for companies to accurately determine hotel pricing in advance”.