Business travel bounceback hits full throttle as 2024 sees seat capacity soar
Africa leads the way in business travel bounce-back with the highest predicted increase in airline seat capacity for the first quarter of 2024. This is according to FCM Consulting’s latest Global Quarterly Trend Report.
Seat capacity in Africa sees a predicted increase of 14 per cent in Q1-2024 as compared to 2019, followed by Middle East (up 11 per cent), Latin America (eight per cent increase), North America (up eight per cent),Asia (seven per cent rise), Australasia (flat), and Europe down two per cent.
Worldwide, Q1-2024 is forecast to see +71.8 million (+5.3 per cent) more seats (both domestically and internationally) than 2019, for the same period. The final 2023 seat capacity is forecast to be -2.2 per cent on 2019.
One of the biggest impediments to recovery so far has been lack of airline capacity and competition. Conditions are gradually improving, which is expected to benefit travellers as the year progresses, but the concern remains regarding the lack of available seats on services between Australia and Europe, via the Middle East.
Fares, however, are still under pressure and are predicted to rise between 3% and 8% in 2024 as a result of fuel, cost recovery, sustainability and fleet upgrades.
When it comes to accommodation, hotel occupancy levels averaged 68 per cent per month in 2023. Over the past six months corporate average room rates (ARR) have plateaued, signalling rate stability. YTD-2023* ARR compared to 2022 in North America was USD$250, Australia/New Zealand USD$160, Europe USD$194, Asia USD$173, Middle East/Africa USD$203, and Latin America USD$128.
However, hotels are forcing 3-8%rate rises for 2024. To counter rises, and reduce travel budget impacts, FCM has started making positive programme shifts for clients, including changing accommodation options to keep within budget with lower star ratings and consolidating suppliers for leverage.
In terms of car hire, the overall global average daily rate (ADR) has increased by four per cent YTD**-2023 versus 2022. The ADR forecast is rate increases will stabilise to +2-3 per cent in 2024.
“As we look at the numbers, it’s clear that Africa is reall leading the charge in the comeback of business travel,” says Bonnie Smith, GM of FCM for Southern Africa. “This significant uptick in airline seat capacity speaks volumes about Africa’s dynamic role in the global market and its untapped potential. At FCM, we’re not just keeping pace; we’re thinking ahead. We’re committed to innovating and adapting to this exciting landscape, ensuring our clients can navigate these changes seamlessly and capitalise on the abundant opportunities that Africa’s growth presents.”