BCD Travel’s recently-released Travel Market Report: 2025 Outlook provides an in-depth analysis of global economic trends, air travel forecasts, hotel rates, car rental insights, and sustainability initiatives.
The report by BCD’s Research & Intelligence team forecasts the global economy to experience modest growth of 2.9% in 2025, with the US leading the pack among developed economies.
However, high prices, geopolitical instability, and an ageing population will influence economic dynamics. Businesses should remain aware of potential challenges such as supply chain disruptions, climate-related events, and volatile fiscal policies.
Next, international air travel is projected to experience a significant rebound, with Asia spearheading growth at 30% above pre-pandemic levels. Domestic travel is expected to stabilize. Global airfare is anticipated to remain relatively flat overall, although regional variations exist.
Business class fares may see a slight increase of one per cent, while intercontinental economy fares are predicted to decrease by 0.6%. Interestingly, the report highlights the potential for increased leverage in corporate travel negotiations as airlines revise their discount strategies.
Meanwhile, average daily room rates (ADRs) are forecasted to rise by 2.9% globally, with the strongest growth anticipated in the Southwest Pacific (+4.6%) and the Middle East (+4.1%). The report offers detailed regional insights, highlighting key growth areas like Saudi Arabia (+6.5% ADR increase), Spain (+6.0% ADR rise), Japan (+8.0% ADR increase), and Tanzania (+11.0% ADR increase).
Leisure demand for car rentals is expected to soften, while corporate rates are likely to increase, especially for contracts not renegotiated recently. While Europe may see relative pricing stability, the Americas and Asia-Pacific regions are likely to experience more dynamic fluctuations.
The report also underscores the rising importance of sustainability in business travel. Increased adoption of Sustainable Aviation Fuel (SAF) is anticipated, potentially leading to higher travel costs, particularly in regions like the EU with upcoming mandates.
Corporations will also need to take into account the EU’s Corporate Sustainability Reporting Directive (CSRD), which emphasises accountability in business travel emissions. The report also highlights the need for companies to develop “meaningful travel” strategies that balance environmental impact, traveller wellness, and business objectives.
The business travel landscape in 2025 will be characterised by moderate economic growth, regional travel recoveries, and a strong focus on sustainability. Corporate travel managers will need to adapt to this evolving environment by actively renegotiating contracts, integrating sustainability practices, and staying vigilant of geopolitical and climate risks.
The full report can be downloaded here.
