Business travel is expected to be even bigger than originally expected this year despite the harsh winter weather in the first quarter that led to some of the worst days for air travel in years.
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The Global Business Travel Association (GBTA) now expects travel spending to rise 7.1% in 2014 to $293.3 billion as business confidence improves. That's up from the 6.6% growth it had predicted just last quarter.
The industry group cites strong investment in international outbound travel spending as a major reason for the upgrade. That subset of business travel is expected to increase 12.9% to $37.2 billion in 2014.
“As the spring thaw gets into full swing, businesses are feeling more confident, with pent-up demand to get their employees back on the road,” said Michael W. McCormick, GBTA executive director and COO. “Today’s forecast suggests that this measured but steady improvement should continue.”
The GBTA also notes that the current crisis in Crimea has had little, if any, impact on the U.S. business travel market to date due to minimal trade ties between the U.S. and Russia. McDonald’s (NYSE:MCD) last week became the first U.S. company to pull out of Crimea.
Europe, however, is more exposed, and the group warns that trade sanctions between the two regions could stall the recovering European economy, which could in turn affect the U.S., and outbound travel.