Amex Predicts Higher Travel Costs For Rest Of '96

<H1> Amex Predicts Higher Travel Costs For Rest Of '96</H1>Byu Stefani C. O'Connor

No matter how you slice it, the cost of consuming the various pieces of the business travel pie-air, car, hotel, meals and entertainment-is going to rise. That's the outlook for the remainder of the year from the perspective of American Express Corporate Services, which has updated its 1996 statistical report "Trends & Forecasts." (For predictions of next year's costs, see Budget Planner, Page 14).

Figures will be higher than originally expected for "typical" business airfares, ranging from 5 percent to 7 percent by year's end, according to Michael Barry, director of Amex's consulting services group, who outlined the forecast. The mega agency had anticipated only a 3 to 4 percent rise, similar to 1995's, but revamped its estimates upward in light of the expected reinstatement this year of the expired federal airline excise tax and the partial shifting of such cost to the traveler.

On the lodging front, the outlook is somewhat better. Although prices are expected to rise, they will climb at a slower rate. Amex revised its initial prediction of a 5 to 6 percent rise in the average domestic corporate room rate to an increase of between 4 and 5 percent-nearly half of the almost 8 percent jump in 1995.

Keeping corporate travelers mobile will run companies an additional 4 to 5 percent when they compare corporate car rental rates to last year. The jump is not as high as in 1995, when a 12 percent rise was driven by fuel increases, airport fees, taxes and the imposition of fees by local, city and state governments. In 41 of 50 major cities, off-airport fees, rental surcharges and area taxes composed more than 10 percent of total car rental bills. This year, gradual corporate rate increases will be reflected as fuel costs rise, Barry said.

Corporations can expect to dish out 2 to 3 percent more to feed their troops on the road. The increases in menu prices this year are expected to be less than the 3 percent rate of inflation.