Business-class airfares on long-haul international flights may rise as much as 10 percent in 2011, returning to pre-recession prices, after carriers cut seating capacity, American Express Business Travel said.
The biggest increases for those tickets will be in the Asia-Pacific region, at 5 percent to 10 percent, while gains in North America will be 3 percent to 7 percent, according to the American Express Co. unit, which helps manage corporate travel accounts. Lodging also will cost more, the unit said today.
â€œPricing power will swing back to air and hotel suppliers for the first time in two years in 2011 as more competition for limited seats on planes and increased occupancy levels at hotels are expected,â€ Christa Degnan Manning, the unitâ€™s research chief, said in a statement.
The business-travel slump during the recession spurred U.S. airlines to chop available seating by about 6.8 percent in 2009, the deepest pullback since World War II. U.S. carriers led by Delta Air Lines Inc. start reporting third-quarter earnings today that may show their biggest profit since 2007.
American Express Business Travel said it made pricing predictions for 89 types of airfares covering 21 countries, and for hotel rates in 535 cities around the world.
International long-haul airfares in business class will cost 5 percent to 9 percent more in Europe and the Middle East, and 3 percent to 8 percent more in Latin America, according to the forecast.
Economy tickets on domestic short-haul flights will be up 2 percent to 9 percent, depending on the region, with North America showing the smallest increases at 2 percent to 6 percent, American Express Business Travel said.
Hotel rates for â€œupper-rangeâ€ properties will rise by 2 percent to 10 percent, led by a 5 percent to 10 percent gain in Asia, according to the forecast. Rooms in â€œmid-rangeâ€ hotels will climb as much as 10 percent.