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Going The Distance

Travel costs are expected to soar this year.
January 1, 1999
URL: http://www.entrepreneur.com/article/17006

There's good news and bad news for business travelers this year, according to researchers at Runzheimer International. Car rental, hotel and meal prices should rise at reasonable rates. But air travel rates will climb considerably faster, rising 10 percent higher in some segments.

The reasons for the increases vary by industry segment. Lack of competition on many air travel routes will lift average full-fare economy ticket prices by more than 5 percent, while high occupancy rates will lead to average lodging cost increases of 4.9 percent.

Smaller fleet sizes and higher costs are exerting similar pressure on car rental rates, which will lurch forward by 4.8 percent, while a trend toward less restaurant dining is keeping restaurant prices at a modest 3.5 percent increase.

As Roanoke, Texas, airline consultant Barry Clark sees it, the markups will especially impact airline travel. "As airlines push their rates higher, [business owners] are going to look for other ways to buy tickets," he predicts. That means you may soon find yourself eliminating some of your travel agent's services in favor of a direct-purchasing agreement.

Car rental rates may outpace air fare increases in some parts of the country, according to Steve Swope. "The cost of supply in the car [rental] industry has gone up, but prices haven't gone up as dramatically as they should have," notes the senior vice president of Talus Solutions Inc., a revenue management solutions provider in Atlanta. "That's going to change this year."

Bruce Tepper, a travel and tourism consultant with Joselyn Tepper & Associates' San Francisco branch, sees another side effect of the rising travel expenses when it comes to hotels. "Demand is catching up with supply in the lodging industry. In many cases, the house is full and there's less willingness for the property to negotiate [prices]," he says. "So travelers [may have to] trade down to a cheaper brand."

One thing is certain: You'll be paying more--perhaps a lot more--for travel in the months to come.


Christopher Elliott is a writer in Los Angeles and a columnist for "ABC News Online."

Escaping Your Cell

New wireless phones offer global access.

If you travel with one cell phone for the United States and another for Europe and Asia, you know how cumbersome wireless communication can be.

Not for much longer. Some new products on the market promise to reduce the number of communication devices you have to lug around. The Bosch World 718 digital phone, for example, is compatible with virtually all GSM (a digital standard used in Europe and Asia) networks. Sold through several resellers in the United States, the new 8-ounce phone picks up domestic 1,900 MHz calls and calls from overseas transmitted at 900 MHz. The phone costs $199 to $350, and calls are charged at local cellular rates. A typical call from the United States to England would cost 80 cents to $1.10 per minute.

The catch? GSM isn't available everywhere. If you're not visiting one of the 2,300 U.S. and Canadian cities where it's available, you may still have to carry an analog phone or find a good, old-fashioned corded phone for emergencies.

Road Notes

Contact Sources

Barry Clark & Associates, (817) 430-0634, hreclark@ix.netcom.com

Bosch, (888) 499-8570, http://www.boschtelecominc.com

Joselyn Tepper & Associates, (415) 587-8748, fax: (602) 443-0098

Omnipoint Communications, (973) 290-2453, jgrotland@omnipoint-pcs.com

Runzheimer International, (800) 558-1702, http://www.runzheimer.com

Talus Solutions Inc., (404) 763-5454, http://www.talus.net