Airfares to rise 4 per cent next year
Likely fuel price increase will make air travel more costly, but probably won't deter 'travel-hungry S'poreans'
Frequent travellers, be prepared to pay more for your flights next year.
Despite the growing use of low-cost carriers, which has led to a decrease in air ticket prices this year, airfares are likely to go up by 3.9 per cent - higher than 2.8 per cent in Asia-Pacific and 3.5 per cent globally.
Hotel prices here, too, will go up by 3.2 per cent, lower than the 3.5 per cent increase in Asia-Pacific and 3.7 per cent rise globally.
The findings, from the 2018 Global Travel Forecast released on Wednesday, were based on research by the GBTA Foundation and travel management company Carlson Wagonlit Travel (CWT).
The report provides global, regional and country-by-country projections for air travel, hotel, ground transportation, and meeting and event prices for next year.
Mr Richard Johnson, the director of CWT Solutions Group Asia-Pacific, said the airlines' fuel costs are directly impacted by oil prices, which are expected to rise next year.
He told The New Paper: "Since fuel is one of the largest operating costs for carriers, depending on how they have hedged their contracts, fuel price volatility will be a factor in ticket price increases."
Agreeing, Ms Justine Koh, marketing communications executive at Chan Brothers Travel, said the increase in fuel charges imposed on the consumer will be largely dependent on the fare structure of the individual airlines and the extent to which their operational costs are impacted by the hike in oil prices.
"Other than oil prices, airfares are also largely determined by demand and supply. Any increase could stem from higher demand relative to supply," she told TNP.
Since fuel is one of the largest operating costs for carriers, depending on how they have hedged their contracts, fuel price volatility will be a factor in ticket price increases.Mr Richard Johnson, director of CWT Solutions Group Asia-Pacific
Dynasty Travel's director for public relations and communications Alicia Seah pointed to the growing affluence and "new wealth" in emerging markets such as China, India and Vietnam, which are likely to keep airfares buoyant.
But given how airfares have been made competitive over the last two years due to the variety of options available, the 3.9 per cent increase is not that significant, Ms Seah said.
That flights will cost more is unlikely to deter "travel-hungry Singaporeans", said Ms Koh.
Demand for year-end travel has been strong, and these travel bookings include not just those for the year-end school holidays but also advance bookings as far as June next year, she said.
"Airlines will likely continue tactical promotions to boost sales, and the surest way to seize the best airfares is to book early if you are inflexible with your travel plan, or watch out for these promotions from time to time if you are flexible with your travel plan."