AMEX GBT forecasts stable air fares overall; with fluctuations on some major routes

The report finds that there is minimal fare movement on most routes

The Air Monitor 2019, published by American Express Global Business Travel (AMEX GBT), finds that fare levels should remain stable on many of the world’s major air routes in 2019.

Capacity and growing competition, including new low-cost carriers on longhaul routes, will likely restrain fare rises on key routes from Europe and Asia-Pacific, even as the global economy is forecast to grow and airlines face rising operating costs. However, current economic and political uncertainties and developments may impact the forecast.

The report finds that there is minimal fare movement on most routes

There are some exceptions to the projection of stable air fares: demand growth in premium classes across North America is forecast to outstrip capacity growth, meaning buyers could see significant price rises on these fares within the region and to Europe. In contrast, fares to Middle East destinations are forecast to fall from all regions, in both business and economy classes. Overcapacity on Middle Eastern routes is the chief factor in the expected price fall.

For the Asia-Pacific, despite expecting both India and China to grow at a slower pace in 2019, a forecast growth rate of 6.3 per cent still makes the Asia-Pacific region the fastest growing set of countries. The outlook for fares across the Asia-Pacific is stable, supported by the strong economies of India, China and Australia. Meanwhile, fares are likely to reduce in price across Hong Kong, Japan and Singapore due to the impact of financial sector slowdown and the loss of premium class traffic.

To generate the forecast, the Global Business Consulting team scanned AMEX GBT’s data lake to examine five years of flight transaction data. This analysis was combined with variables including oil prices, economic projections and airline strategies to forecast price changes on key business travel routes around the world.

For comprehensive details and analysis of the conditions impacting air fares over the coming year, download the Air Monitor 2019 here.

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