Business travel is getting more expensive, but it's also becoming more predictable.
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Just when you thought your travel budget was sorted for 2025, new data from the travel consulting company, FCM’s Business Travel Report might have you reaching for your calculator—and here's why.
With business class fares jumping and flights packed, travel managers face tough conversations about rising costs.
"Our data tells two stories," says Bonnie Smith, GM of FCM South Africa. "Yes, travel is getting more expensive, but it's also becoming more predictable. Travel managers who book ahead are saving on airfares and getting better hotel rates. The opportunity to be strategic with your travel spend has never been greater."
The sky's getting crowded
Global passenger demand was up 8.6% in August 2024 compared to 2023, with business class tickets costing between 6 and 8% more compared to 2023. The good news is that economy fares have dropped by between 1 and 4% versus 2023.
The hotel squeeze
If you're wondering why your hotel bills in Joburg are looking a bit steeper lately, you're not alone. Room rates are up 14%, and if you think that's eye-watering, spare a thought for your colleagues heading to New York, where they're looking at $490 (R8,800) a night—a rise of 15%.
The average room rate is up in North America (6.8%), South America (25.4%), and Europe (5.3%), with a gentle softening of prices in the Middle East/Africa, Asia, and Australia.
What this means for you in 2025
Location isn't everything. Some of the best business hotels are just a short ride from the city centre, and they're often better equipped for productive work.
While global inflation is cooling off, some spots like Brazil and India are still seeing prices climb, the good news is that the rand is working harder in some markets than others.
Airlines are promising more seats for 2025 (1.8% more in the first half of the year and 2.1% more in Africa); however, more seats don't automatically mean cheaper fares.
Keep an eye on new route announcements; they often come with corporate deals
The companies winning at the travel game aren't necessarily the ones with the biggest budgets—they're the ones being clever about how they spend it, says Smith, highlighting the role of a TMC in cost and value optimisation. Smith advises companies to leverage their TMC's expertise in several key areas.
"Your TMC’s AI tools can analyse your travel patterns and suggest cost-saving opportunities you might miss, like booking premium economy instead of business class on shorter routes where the price difference outweighs the benefits."
She also emphasises the power of consolidated buying. "A good TMC brings negotiating power you simply can't match alone. We're booking thousands of room nights and flights, which means better rates and more flexible terms for our clients.
"Success in 2025 isn't just about managing costs—it's about making business travel work harder for your company. Whether it’s through better planning, smarter technology, or having the right support team in your corner, you’ll achieve maximum value from every trip."
IOL Travel
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