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Business travel costs forecast to rise
 Travelers' credit cards are expected to take more of a battering in 2006. BUSINESS TRAVELLER
YOUR SAY
YOUR E-MAIL ALERTSLONDON, England (CNN) -- Executives will have to dig deeper next year to cover expenses according to new forecasts which warn that global travel costs will rise. American Express Business Travel says that there is likely to be a shortfall in the supply of services to people on the move, despite an increase in demand. Efforts by hoteliers, airlines and car rental firms to recoup losses caused by galloping fuel costs and scares such as the current bird flu outbreaks will lead to significant price hikes, it said. But price hikes are likely to be tempered by new competitiveness among airlines as low-cost carriers keep the aviation market in check, according to the company's director of global consulting, Matthew Davis. "Corporate clients are traveling more, and increased globalization is leading to strong demand for long-haul air travel and hotel space at their travelers' destination," he said. 'Global fares rising'Air fares for international business class travel are expected to jump by between 3 and 4 percent, the company's figures suggest, with Europe and Latin America subject to the highest possible rises of between 6 and 7 percent. "Whilst global fares are rising across the board there are significant variations by region and even the countries within those regions," Davis said. He said the unrelenting rise in oil prices will continue to impact on air fares, even as the emergence of low-cost carriers, some created by traditional airlines, creates a more competitive market -- particularly in Asia-Pacific. In the hotel sector, rising occupancy rates against a limited growth in supply will lead to stiffer bills, particularly in India and China as both countries continue to enjoy economic booms and strengthening global business links. The forecast also warns that hotels in certain cities could see significantly above average contract-rate rises. In London these increases could reach up to 15 percent. Shrewd planning needed"Yesterday's good rate may well be unobtainable tomorrow -- leading to unpredictable hotel coasts and, occasionally, an inability to obtain a suitable room," Davis said. "Unless a company locks in a negotiated rate with 'last room availability,' prices will rise in proportion to occupancy levels in a given city." Davis said that with careful long-term planning, shrewd businesses should able to capitalize on an uneasy travel market, but last-minute organization will prove costly. "It will be even more important for corporations to seek expert advice in travel planning, as expertise in this arena may pay back big dividends. "Without a well-maintained hotel program in place, companies can expect to pay significantly more for walk-up rates. It is clear that the outlook for 2006 will challenge the most experienced procurement managers." 
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