Air fare, hotel tariffs expected to increase in 2011: Survey

MUMBAI: Domestic airline fares are expected to go up by 12-14 per cent, while hotel tariffs would go up in the range of 5-6 per cent in 2011, according to a survey.

"On an average, the domestic fares are likely to go up by 12-14 per cent. However, this increase will spread through the quarters," according to a survey 'Corporate Travel-Trends, Outlook and Opportunities- 2011' released by Thomas Cook here.

On the domestic airlines front, load factors averaging around 80 per cent and stable demand forecast, robust yield management and higher anticipation of revenues from key domestic airlines will drive fares north-wards, Thomas Cook Corporate Travel Forecast for 2011 said.

There will be an increase in premium traffic projected by airlines on the back of strong domestic consumption demand. Constrained capacity at Indian airports during prime time slots will result in Corporate India buying. The increasing crude oil prices can also result in increase of taxes, it said.

On the international air front, North American sectors are going to witness maximum fare hikes and on a whole, corporate can expect these fares to go northward between 7-9 per cent on a leveraged spend of predominantly US/Europe and rest of the world, it said.

The domestic hotel tariffs would also go up in the range of 5-6 per cent and on international front; it may go up by 4-5 per cent for a well negotiated hotel deal. However, corporate volumes and loyalty with relationships will drive the savings the corporation can achieve, the survey said.