=20 ---------------------------------------------------------------------- This article was sent to you by someone who found it on SF Gate. The original article can be found on SFGate.com here: http://www.sfgate.com/cgi-bin/article.cgi?file=3D/chronicle/archive/2002/11= /29/BU157816.DTL ---------------------------------------------------------------------- Friday, November 29, 2002 (SF Chronicle) Business travelers will have to dig deeper/Airfares, rental cars, hotels wi= ll all cost more in '03, studies say Diane E. Lewis, Boston Globe Two different studies are predicting the same thing: a hike in business travel costs in 2003. The National Business Travel Association, a nationwide trade group of 2,400 corporate travel managers, predicts a 5 percent increase in future business travel costs in several key segments. Among other things, the group says that business airfares are likely to jump by 7 percent, hotel rates will increase 2 percent, and corporate car rental rates will rise 2 percent next year. A separate report, the American Express Trends and Forecasts for the Business Travel Industry, says corporate travelers should expect domestic business airfares to rise 3 to 4 percent and international airfares to increase 4 to 5 percent. The report, based on industry expectations for the coming year, notes that the average U.S. employer spends about 45 percent of its travel and entertainment budget on airfares. Typical one-way business airfares were $572 during the third quarter of 2002, about 2 percent below the third quarter of 2001. The company reported that in the third quarter of this year, airlines' lowest discount airfares averaged $99 one-way, 11 percent lower than the lowest average discount price a year earlier. This information came from the American Express Business Travel Monitor, which monitors various categories of airfares on hundreds of domestic routes. American Express also predicts a 1 percent decline in domestic hotel rates, as hotels and other lodging establishments struggle with the low demand for hotel rooms. However, meals, daily car rental rates, and telecommunications are expected to climb 2 to 3 percent in 2003. Increased concerns about security during the past year and the sluggish economy caused U.S. corporations to slash travel budgets in 2002, but each study says travel is likely to increase as the nation's economic outlook improves. "Corporations have changed the way they purchase business travel," said NBTA President Kevin Iwamoto. "Moving into 2003, our forecast shows that business travel will resume as the economy recovers. Yet, overall travel spending will remain flat in the coming year as corporations continue to focus on the bottom line." Said Brian Mogler, vice president of supplier relations and consulting at American Express Corporate Travel: "Over the past few years, companies have tightened their travel programs and reduced air travel spending by using more leisure type fares. But many will see their average fares rising, now that the airlines have put new restrictions on the lowest fares and stopped applying corporate discounts to them. "In addition, barring a further economic downturn, business travel demand is likely to improve, creating upward pressure on pricing."=20 ---------------------------------------------------------------------- Copyright 2002 SF Chronicle