Western European Economy ‘Gathering Steam’ – Business Travel Experiencing Breakout
Germany Leading the Way with 10 Percent Business Travel Growth in 2015
Business travel spending in Germany, the U.K., France, Spain and Italy combined will grow at over 6 percent in 2015 and 2016, a leading indicator that the European economy is “gathering steam” and is poised for a moderate economic breakthrough. These findings are part of the semi-annual GBTA BTI™ Outlook – Western Europe report, conducted by the GBTA Foundation, the education and research arm of the Global Business Travel Association (GBTA), and sponsored by Visa, Inc.
These five markets comprise nearly 70 percent of Western Europe’s business travel market. Business travel spending in the countries will grow 6.4 percent in 2015 and another 6.3 percent in 2016. In total, this segment of the Western European business travel market will grow from $186.3 billion USD (€140.2 [1] billion) in 2014 to $210.6 billion USD (€220.3 [2] billion) in 2016.
“The study shows that the European economy is gathering steam and beginning to put its economic woes in the rear-view mirror,” said Catherine McGavock, GBTA’s Regional Vice President – EMEA. “Business travel is faring even stronger than the moderate economic breakthrough, with double digit spending growth in Germany as well as over 7 percent growth in both the U.K. and Spain this year. Still uncertainties in the global economy present risks to this business travel breakout, leading to a cautiously optimistic outlook for many companies.”
After 2014 proved to be a bounce-back year for Western European business travel, the recovery continues to pick up the pace in 2015 with Germany, the UK and Spain leading the way, according to the report.
Germany represents over 20 percent of Western Europe’s business travel activity and continues to be the strongest market on the continent. The UK has exhibited some of the strongest performance in the region as improving employment and low energy prices have spurred consumption. Spain continues its impressive economic turnaround and is expecting robust business travel growth this year. France and Italy, on the other hand, are the two most challenged markets with weaker economic growth leading to much lower business travel growth rates.
“With this continued growth forecast in Europe, companies will want to retain control of their costs as travel activity increases,” said Tristan Kirchner, Executive Director, Sales and Marketing, Visa Europe. “Visa’s best-in-class payment solutions play a key role in providing buyers and suppliers with the visibility and automation needed to drive efficiencies to the bottom line.”
Country-Level Business Travel Outlooks
Germany –a $57.9 billion USD market (€43.6 billion) – is leading the way, with 10 percent business travel growth projected in 2015 and 9.5 percent in 2016. Spending on domestic business travel is surging at 11.4 percent this year and 10.4 percent next year, while international outbound business travel will grow 4.2 percent in 2015 and 5.5 percent in 2016
The United Kingdom – a $43.5 billion USD market (£26.4 billion) – is expected to grow at 7.4 percent in 2015 and 6.2 percent in 2016. Spending on domestic business travel will grow at 8.3 percent in 2015 and 7.8 percent in 2016, while international outbound travel will grow at 5.5 percent in 2015 and 3.1 percent in 2016.
Spain – a $18 billion USD market (€13.5 billion) – is expected to grow at 7.7 percent in 2015 and 7.1 percent in 2016. Spending on domestic business travel will grow at 8.6 percent in 2015 and 7.8 percent in 2016, while international outbound travel will grow at 4.6 percent in 2015 and 4.8 percent in 2016.
France – a $36 billion USD market (€27.1 billion) – is expected grow at 3.1 percent in 2015 and 3.4 percent in 2016. Spending on domestic business travel will grow at 4.1 percent this year and 4.5 percent next year, while international outbound travel will grow at 2.5 percent in 2015 and 3.4 percent in 2016.
Italy – a $31 billion USD market (€23.3 billion) – is expected to grow at 1.1 percent in 2015 and 1.9 percent in 2016. Spending on domestic business travel will grow at 0.8 percent this year and 1.4 percent next year. International outbound travel will grow at 4.1 percent in 2015 and 5.0 percent in 2016.
The GBTA BTI™ Outlook – Western Europe is free of charge to all GBTA Members by clicking here. Non-members may purchase the report through the GBTA Foundation by emailing pyachnes@gbtafoundation.org.
[1] Converted based on 2014 average market exchange rate
[2] Converted based on forecasted 2016 average market exchange rate