The ever-evolving landscape of global travel pricing is seeing a dynamic shift as Advito unveils its 2025 Q1 Travel Price Index, a meticulously crafted analysis of airfares, hotel rates, rail trends, and car rental costs. The report captures a snapshot of the industry, offering invaluable insights for travel managers grappling with fluctuating markets and consumer demands.
With leisure travel demand tapering, corporate travel is regaining its dominant position, redefining negotiations, and spotlighting sustainability and traveller wellbeing. Here’s a detailed look at the report’s revelations, key trends across regions, and actionable strategies for stakeholders.
Market Highlights: Europe in Focus
Europe’s travel market presents a nuanced picture for Q1 2025:
- Airfares:
Domestic and regional airfares continue to rise, fueled by reduced domestic capacity in Germany, France, and the UK. Additionally, environmental surcharges imposed by European carriers have elevated intercontinental fares.
However, Asia-bound flights from Europe are witnessing a price drop thanks to an influx of flights to China during the winter, marking a rare cost relief in the region. - Hotel Rates:
European hotel rates are stabilizing compared to the previous year. Despite this, certain hotspots like Gdynia, Antalya, Tromsø, Heraklion, and Oulu are experiencing double-digit rate hikes due to localized demand surges. Occupancy levels across Europe remain higher than in 2023, reflecting sustained interest in regional travel. - Rail and Rental Cars:
Rail fares exhibit significant regional variances, with Southern Europe seeing moderate increases, while Northern Europe, led by Germany and the UK, faces sharper spikes. High demand for Germany’s €49 monthly rail pass and regulated UK rail fares drive these trends.
On the rental car front, companies are taking a conservative approach to fleet planning, causing daily rates to inch upward as demand cools.
Understanding the Index vs. Forecasts
Unlike long-term forecasts that predict future pricing based on socioeconomic data, the Advito Travel Price Index focuses on actual historical data. Comparing past pricing trends with future shopping data provides a short- to medium-term outlook—ideal for travel managers navigating volatile markets.
Since its inception in Q4 2022, the Index has become a trusted resource for identifying global airfares, hotel rates, rail costs, and rental car pricing trends.
Air Travel: Key Takeaways for Travel Managers
As corporate clients reclaim prominence, airlines are eager to solidify partnerships with business travellers. Here’s what travel managers should prioritize:
- Maximize Tracked Spending:
Ensure compliance among corporate travellers to minimize off-channel bookings, enhancing your negotiating power. - Evaluate Total Contract Value:
Focus beyond base fare discounts, considering environmental, fuel, and GDS surcharges, which now constitute nearly 20% of ticket prices. - Prioritize Sustainability:
Collaborate with airlines offering sustainable practices and robust traveller well-being programs, crafting bundles that align with company values.
Hotel Programs: Enhancing Traveler Experience
With rates stabilizing, now is the time for travel managers to fine-tune their hotel programs:
- Audit and Adjust Rates:
Regularly evaluate negotiated rates to ensure they remain competitive and accessible. Negotiate better deals with properties that fail to add value. - Optimize Online Booking Tools (OBT):
Refine the traveller booking experience by adjusting sort orders, removing barriers, and integrating custom messaging to drive compliance and satisfaction.
Why Advito’s Report Matters
In today’s volatile market, understanding short-term trends is critical. The Advito Travel Price Index equips travel managers with the tools to make informed decisions, balancing cost management, traveller experience, and sustainability goals.
To access the full report and explore detailed regional breakdowns and sector-specific insights, visit Advito’s official report page.
Looking Ahead
Advito’s Q1 2025 Travel Price Index sets a confident tone for the travel industry, signalling to ease costs amidst dynamic market conditions. For businesses navigating the complex web of corporate travel, this report provides a roadmap for more innovative negotiations and enhanced traveller experiences.
Written by: Anne Keam
