- Business Travel Spending Set To Grow 5.1% in 2014, 6.5% in 2015
- First Year Since 2010 Forecast Projects Increase in Business Travel Spend in all Five Markets
LONDON, March 13, 2014 /PRNewswire/ -- The Global Business Travel Association (GBTA), the voice of the global business travel industry, announces the results of its latest GBTA BTI™ Outlook – Western Europe report, a semi-annual analysis of the five most critical business travel markets in Europe: Germany, the UK, France, Italy and Spain. These five markets together form the lion's share of business travel in the region acting as a good barometer of the health of the entire European business travel market. The report, sponsored by Visa Inc., includes the GBTA BTI™; an index of business travel spending that distills market performance over a period of time.
Key highlights of the report include:
- Business travel spending among the five markets is expected to hit $186.5 billion USD (€137B) in 2014, a 5.1% growth over 2013. The projected rate of growth is expected to increase in 2015 as spending picks up another 6.5% growing to $198.6 billion USD (€157B).
- The outlook for four of the five markets included in our analysis, Germany, the UK, France and Spain, were all revised upward from our expectations in our GBTA BTI™ Outlook – Western Europe 2013H2.
- Improved business confidence and expectations for stronger economic growth and employment growth contributed to stronger expectations for both domestic and international outbound business travel in Western Europe.
- While the North – South divide still exists and Germany and the UK will again lead the way in business travel spending for the rest of the region, France, Italy and Spain now appear to be showing solid signs of recovery.
- 2014 is expected to be first year since 2010 that sees all five business travel markets included in our analysis witness gains in business travel spending.
"Continued signs of strength and progress in the European economy and gathering momentum suggest that 2014 will be a transition year, said Catherine McGavock, Regional Director for Europe for GBTA. "At long last the 2012-2013 recession appears to be over and the European economy on a more solid footing. While challenges remain, this is very positive news and bodes well for business travel growth as business confidence rises across the region."
"According to the report, stronger economic conditions are forecast to lead to an across-the-board increase in business travel throughout Western Europe," said Tad Fordyce, SVP, Global Commercial Solutions, Visa. "As 2014 progresses there are still economic hurdles to clear, but the overall forecast is trending in a positive direction."
Outlook Positive, But Challenges Remain
Of course risks to this fragile recovery and a more promising forecast are ever-present. The sovereign debt crisis is far from over, oil prices are always a danger given the potential for Middle East supply interruptions and emerging markets currency risk has also recently show the potential for financial shocks. A new worry is the concern over current rates of disinflation giving way to deflation which can lead households and businesses to delay purchases in anticipation of lower future prices causing aggregate spending to drop.
Country-Level Business Travel Outlooks
- The German economy continues to remain one of the most robust in all of Europe. GBTA expects business travel spending to grow 7% in 2014 and really pick up the pace in 2015 with 10.6% growth – an unprecedented rate for a market as developed as Germany's.
- Spending on domestic business travel is on the rise with expected growth of 7.2% in 2014 and another 12.2% in 2015.
- After rebounding with 5.3% growth in 2013, GBTA expects international outbound travel spending to increase 6.3% in 2014.
- GBTA expects strong performance in UK business travel over the next two years with total business travel spending near $43 billion USD (£25.7B) in 2014, up 4.4% from 2013. Spending will continue to pick up pace in 2015, advancing 5.1% to $45.2 billion USD (£27B).
- Domestic spending is poised for strong growth in 2014 and 2015, with projected growth of 5.0% and 6.9% respectively.
- International outbound business travel is projected to grow 3.2% in 2014 and 1.7% in 2015.
- GBTA forecasts total business travel spending will finally turn positive in 2014 after two years of decline growing 5.4% to $37 billion USD (€26.8B) and will see similar gains in 2015, expanding 5.5% to $39 billion USD (€30.6B).
- Domestic business travel spending continues is expected to pick up momentum over 2014 and 2015 with growth projected at 3.6% and 7.1% respectively.
- Snapping back from negative spending in 2013, international outbound spending is expected to grow aggressively in 2014 at 8.8%, before it will moderate in 2015 with 2.6% growth to $13.5 billion USD (€9.8B).
- Spanish business travel spending has fallen on an annual basis for 10 consecutive quarters, but after finally beginning to grow in the second quarter, GBTA expects a 4% rise in 2014 followed by another 5% increase in 2015 to $18.4 billion USD (€14.4B).
- Domestic business travel will pick up 2.5% in 2014 and quicken the pace in 2015, growing 5.2%
- Spending on international outbound will leap forward 10% in 2014 and moderate to 4.2% growth in 2015.
- GBTA expects the first quarter of 2014 will be the last quarter of annual spending declines forecasting 2.8% growth followed by another 2.8% growth in 2015 to $32 billion USD (€25.2B).
- After falling in 2013, spending on domestic business travel in Italy will grow 2.4% in 2014 with similar projected gains of 2.3% in 2015.
- Spending on international outbound business travel is projected to rise even more steeply than domestic spending with gains of 6.5% in 2014 and another 6.7% in 2015.
About the GBTA Foundation:
The GBTA Foundation is the education and research foundation of the Global Business Travel Association (GBTA), the world's premier business travel and corporate meetings organisation. Collectively, GBTA's 6,000-plus members manage over $340 billion of global business travel and meetings expenditures annually. GBTA provides its network of 21,000 business and government travel and meetings managers, as well as travel service providers, with networking events, news, education & professional development, research, and advocacy. The foundation was established in 1997 to support GBTA's members and the industry as a whole. As the leading education and research foundation in the business travel industry, the GBTA Foundation seeks to fund initiatives to advance the business travel profession. The GBTA Foundation is a 501(c)(3) nonprofit organization. For more information, see gbta.org and gbta.org/foundation.
SOURCE Global Business Travel Association