Corporate travel budget growth is accelerating, but buyers have lost some of their optimism over the past year according to a new Morgan Stanley survey.
The survey of 150 corporate travel managers, conducted March 23 to April 7 by Morgan Stanley's AlphaWise research unit, showed buyers expect their travel budgets to increase an average of 5.8 percent year over year in the first half of 2026 and by an average of 6 percent year over year in the second half of the year. For 2027, buyers project their budget will increase by an average of 6.1 percent year over year.
That increase for 2026 is slightly above what buyers projected in Morgan Stanley's previous survey in October 2025, when buyers projected their 2026 budgets would increase 5 percent year over year on average, according to the firm.
Buyers in the survey indicated that they expect both volumes and pricing for airfares and hotels this year to be up in the mid-single-digit percentages year over year. For negotiated corporate airfares, buyers expect an average 4.5 percent increase year over year in the first half of the year followed by an average 5.1 percent increase for the second half. In 2027, buyers project negotiated airfares will increase by an average of 5.5 percent year over year. Those increases come among expected average passenger volume increases of 5.4 percent year over year in the first half of 2026, 4.4 percent in the second half and 6.3 percent in 2027.
Expectations are similar for hotels, with buyers projecting room rates to be up an average of 4.9 percent year over year in the first half of 2025 and up 5.4 percent in the second half, which is higher than the projected 4 percent increase buyers indicated in the October survey, according to Morgan Stanley. Buyers said hotel room volume would increase an average of 5.1 percent year over year in the first half of 2026 and up 5.1 percent year over year in the second half.
For 2027, buyers expect hotel rates to be up an average of 5.1 percent year over year and volumes to be up an average of 5 percent year over year.
The survey indicated buyer optimism has dimmed slightly compared to a Morgan Stanley survey in April 2025. In the new survey, 27 percent of buyers said they were somewhat pessimistic about business travel, compared with 16 percent of buyers in the 2025 survey. The number of buyers saying they were somewhat optimistic dropped to 24 percent in the current survey compared with 41 percent in last year's survey.
Geopolitical instability was the top reason for pessimism in the survey, with nearly half of respondents listing it in their top three factors likely to have a negative impact on business travel this year and 28 percent listing it as the top factor. Other factors at the top of buyers' concerns included travel budget revisions and cost savings, listed by 9 percent of buyers as the top concern, and the economic and market outlook, listed as the top concern by 8 percent of buyers.