On the Road Again
Business travelers can expect expenditures to climb in '98

Using primary data gathered from their client base and industry sources, Travel One, one of the country's largest travel management companies, has compiled an overview of the trends and predictions that may impact business travelers and their companies in the year to come:

Airfares
Predicted 1998 increases:
Domestic +6%
International +7.5%

Fare increases will result as relentless pressure to pen new labor contracts continues from pilots at almost every major carrier. In response to these continued increases, corporations will begin to investigate air travel alternatives. Look for increased activity in the area of fractional or all-out ownership of corporate aircraft to serve frequently traveled markets. Charters wilt remain a viable option to curb price increases and regulate fare levels. Outside influences such as travel advocacy groups and federal/local government officials will put increasing pressure on carriers to maintain a fair pricing structure.

Despite their cost advantage, small niche carriers are finding it difficult to compete against large airlines. As a result, some small carriers will file for bankruptcy and cease operations.

Hotels
Predicted 1998 increases:
Average rates +10%

With national hotel occupancy rates exceeding 71 percent and high demand predicted to continue, rates will continue to increase. These all-time high rates may force a downward shift in corporate policy toward less expensive properties. As companies search for alternatives to keep costs down, they will begin to consider corporate housing in frequently visited cities or may choose to buy a block of hotel rooms at a discounted rate. If hotel rates continue to skyrocket, took for changes in company policies favoring one-day trips versus overnight stays, when possible.

Car Rentals
Predicted 1998 increases:
Average rates + 5%

Car rental companies have greatly improved their ability to match their supply of cars to daily demand. This should help control the need to charge premiums for midweek rentals to subsidize idle cars over the weekend.

Renters seem to have a magic number in mind for what is a "fair" price to rent a car - generally about a base rate of $43 and rental companies are hesitant to blatantly cross this imaginary line.

Meals & Entertainment
Predicted 1998 increases:
+2.5%

Meal cost increases match that of general inflation. Hotel restaurants, especially those in major markets, are forced to compete with other local restaurants.

Total Travel/Entertainment
Predicted 1998 increase:
Weighted average +6.5%

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