US business travel forecast to surge
The US business travel forecast by the Global Business Travel Association (GBTA) sees a continued surge in 2014, despite abnormally harsh winter weather conditions across the country.
With reports of healthy corporate profits, increased management confidence and growing job development, the GBTA has significantly upped its US business travel forecast for 2014.
US business travel spending is forecast to increase by 7.1% to $293.3 billion in 2014, compared to its last prediction of $268.8 billion made at the end of 2013.
Total person-trip volume is predicted to rise to 464.7 million trips, an increase of 2%, says the GBTI BTI Outlook – United States 2014, Q1 (login required), a Visa Inc. sponsored report from GBTA.
Investment in outbound travel spending is expected to rise by 12.9% to $37.2 billion in 2014, compared to a 12.5% increase that had been predicted at the end of last year.
Outlook for group travel by GBTA was also revised upwards from 6.5% to 7% growth in 2014 to $126 billion.
Growth set to continue
Michael W. McCormick, GBTA executive director and COO, said:
“As the spring thaw gets into full swing businesses are feeling more confident, with pent-up demand to get their employees back on the road. Business travel growth is a leading indicator of job growth, and we’ve seen this play out in previous quarters as the private sector has finally regained all of the jobs lost during the recession. Today’s forecast suggests that this measured but steady improvement should continue.”
Tad Fordyce, SVP, Global Commercial Solutions for Visa, said:
“According to the BTI forecast, business travel in the U.S. will see strong gains in 2014, fueled by outbound international business travel. As more employees travel globally, organizations that use electronic payments have a convenient and secure way to pay for business travel expenses no matter where they travel in the world.”
Crimean crisis no impact on US business travel
According to GBTA, the Crimean crisis has had little, if any, impact on the American business travel market so far, probably because of the minimal trade ties between Russia and the US.
Trade ties between Russia and Europe, however, are considerable. A trade embargo could have damaging consequences for European economic growth, which would then have a knock-on effect on US business travel growth.
A trade war or embargo involving oil and gas could affect the travel industry by pushing up the price of jet fuel.
McCormick said: “The Eurozone is exposed to the Crimean crisis and there is a chance that an ongoing issue could create a slowdown in Europe, negatively impacting international outbound travel from the U.S. We’re poised to finally start seeing stronger business travel spending in the Eurozone, and any political uncertainty could hamper projected growth with our largest trading partner.”