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Airfare, Hotel Rates Will Rise How Much in 2018?

With strong demand in most parts of the world, the cost of travel has only one place to go: up. No big surprise there. If there’s anything surprising about the price creep, it’s how modest at least one analyst expects it to be.

According to BCD Travel’s latest forecast, airfares are expected to rise 1 percent in 2018, and hotel rates will rise 2 to 4 percent.

And it’s not just robust demand for travel that’s driving up airfares. BCD expects oil prices, a major contributor to airline costs, to rise from $50 to $60 a barrel.

So, the global economy will expand by 3.2 percent (another BCD prediction), fuel prices will spike 20 percent, but airfares will only increase 1 percent? That seems like a wildly optimistic scenario, given the airlines’ intense focus on maximizing profits.

If the hotels can raise their rates by 2 to 4 percent, it seems a fair bet that the airlines will want to increase their fares by a comparable amount. We’ll have to wait until December 31 to see how close BCD’s predictions come to capturing the actual price increases.

Reader Reality Check

How much do you expect to see airfares rise in 2018?

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After 20 years working in the travel industry, and 15 years writing about it, Tim Winship knows a thing or two about travel. Follow him on Twitter @twinship.

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