Moderate price rises forecast for 2018

Marginal rises in airfares and hotel rates are forecast for 2018, with growing demand for air travel tempered by an increase in capacity and competition.

The latest research from Advito says intercontinental airfares from Europe are likely to remain static in economy and rise 2% in business class, while regional fares will rise 2% in economy and 1% in business.

Advito says cautious capacity expansion means airlines can continue to grow revenues without the need for higher fares, but prices may start to trend slowly upwards in markets where demand is strongest.

Meanwhile, hotel rates are forecast to rise between 1% and 3% in Europe and by 2% to 4% globally as demand continues to outpace supply in many markets.

“A healthy pipeline of new supply will help moderate the extent of these increases in some emerging markets,” says Advito.

“And there are signs that the pricing power enjoyed for several years by hotels in North America and Europe may soon pass its peak.”