CWT Solutions Group, the consulting arm of the global travel management company, has forecast a 4 per cent drop in average ticket prices (ATP) for air bookings by April.

The decrease in price from February’s levels will come as published fares correct from a sharp increase seen in the first two months of 2019.

CWT Solutions Group has published its findings in the third edition of its bi-monthly Air Trends Report, which uses a proprietary algorithm to predict changes.

The global ATP climbed roughly 6 per cent month-on-month in January, followed by a further 3 per cent in February, to reach US$702. This was largely the result of airlines around the world implementing new commercial policies and revenue management models, according to CWT.

By April, ATP is expected to fall to around $673.

Christophe Renard, VP of CWT Solutions Group, commented: “We foresee a continued upward trend in the average ticket price through 2019. One of the reasons is that more airlines are looking to adopt IATA’s New Distribution Capability (NDC) standard as a means to generate greater ancillary revenue such as seat selection and baggage fees. Post-booking price tracking tools can be an effective way for companies to optimise the cost of expensive tickets before upcoming departures.”

Meanwhile, CWT Solutions Group’s research found the use of online booking tools (OBTs) continues to gradually increase as the main providers continue to evolve the user experience, especially on mobile apps. The firm said efforts are also being made to improve the content available through these channels. At the same time, travel managers are encouraging the use of these OBTs and mobile apps.

Total usage stabilised at 48 per cent globally in January and February following a 6 per cent increase from October to December. This percentage is predicted to rise again in March and April, with more than 50 per cent of all bookings expected to be made through OBTs for the first time.

In addition, CWT Solutions Group has forecast a worsening of travellers’ advance purchase behaviour. Tougher policy enforcement in relation to year-end budget constraints saw an improvement in lead time, which carried over to January and February, with around 47 per cent of tickets booked more than 14 days prior to departure.

With budgets renewed and businesses loosening their belts, advance purchase behaviour is expected to fall to 43 per cent in March and April.

Renard continued: “In order to keep a handle on costs, travel managers are advised to stress the importance of booking in advance, either as a message displayed on the OBT or through targeted communications to individual travellers. It’s also important to ensure that OBTs are properly set up to reflect the organisation’s travel policy, or to configure these tools with bespoke settings for each market.”

Read the full Air Trends Report here

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