Advito Reveals Gentler Surge in Q1 Travel Costs

In the first quarter of 2025, intercontinental airfare and global hotel prices are anticipated to rise by fewer than 5 percent year over year, as per Advito’s quarterly Travel Price Index, made public this week. Domestic airfares appear to be more fluctuating, according to the consultancy.

The average year-over-year increases in intercontinental airfare, particularly in business class, indicate what Advito describes as “a certain normalcy” in the market, following the significant rises in the inflationary post-pandemic era. Although leisure demand is diminishing, the company observed that fees added to fares related to fuel, distribution channels, or sustainability have contributed to the overall expense.

Domestic fares across economy and business class exhibit more fluctuation by market, in part due to “supply chain disruptions and aircraft grounding,” which will “affect domestic supply.”

Advito, the consulting division of the travel management firm BCD Travel, calculated the Travel Price Index utilizing predictive analytics based on forthcoming shopping data.

Intercontinental airfares originating from North America are predicted to increase by 4 percent year over year in business class and decrease by 1 percent in economy class. Intercontinental rates starting in Europe are expected to rise by 3 percent in both business and economy.

The company forecasts a 2 percent year-over-year rise in the global average daily hotel rate for the first quarter, noting that the “softening of leisure travel demand is leading to gentler cost increases in several markets,” according to Advito. The first-quarter ADR is expected to grow by 3 percent in North America and 1 percent in Europe.

Advito anticipates that car rental prices in the United States will rise by 2 percent year over year in the first quarter. It highlighted that “on average, electric vehicles currently constitute less than 10 percent of” U.S. car rental company fleets, adding that “substantial reorganization has been implemented to align with existing client needs.”