Industry Trends: What Businesses Need to Know for 2026

As we approach the halfway point of 2026, many businesses are planning for the next six to 12 months of corporate travel. These organizations are also looking for insight into the potential impact of war in the Middle East, particularly on the cost of air travel. Unfortunately, it is difficult to project airfare with confidence at this point due to the macroeconomic factors at play.

Travel programs will benefit from relatively stable base rates across the hotel industry and car rentals. However, that does not mean these industries are static. Persistent cost pressures, evolving traveler expectations, accelerating AI capabilities, and heightened duty-of-care considerations will continue to play a role in corporate travel throughout 2026.

Local conditions and geopolitical and economic factors can change quickly and impact rates, as we are seeing in air travel. Your organization should remain flexible and forward-thinking to make the most of business travel this year.

Base rates are predicted to remain stable in 2026, particularly for flights originating from and arriving to North America. While supply remains higher than demand, labor costs will increase this year after several negotiations in the US and Canada, and fuel costs could become increasingly volatile at any time.

While base rates remain stable, total costs may not be as predictable. Premiumization of the air travel experience—including an increase in available products and services—and continuous pricing will all impact how much businesses spend on air travel, as well as the predictability and visibility of this cost.

Southwest’s shift toward premium content (like the amenities provided with the new Choice Preferred and Choice Extra ticket classes) and introduction of assigned seating (including preferred seating options) is just one example of this trend’s impact on travel programs and their travelers. All major US carriers are investing in premium content, which drives airline profitability, such as first, business, and premium economy experiences and ancillary components like preferred seating and preferred boarding. Organizations should consider a 2-5% uplift to account for this premiumization.

New Distribution Capability (NDC), a new data transmission standard, further enables personalized offers, dynamic pricing, and product differentiation. This real-time pricing presents both benefits and risks to travel programs. American Airlines and United Airlines were early adopters of this technology; their aggressive transition to NDC disrupted the market. This year, JetBlue and Delta will introduce NDC capabilities in what we expect to be much more thoughtful rollouts. The Travel Team covers NDC strategy and status across major North American carriers in our NDC Fact Sheet.

The industry’s predictions for stable base rates in 2026 did not (and still do not) account for the increased fuel costs we’re experiencing as a byproduct of war in the Middle East. Historically, a 10% sustained increase in fuel costs (which are more volatile than crude oil) has resulted in a 1-2% increase in airfare. Travel programs should consider:

Businesses should take steps to retain insight into spend, despite changing pricing models and fare unbundling.

Structuring travel policy with the flexibility to consider travel experience alongside business objectives is important, as travelers have increased product choices while simultaneously losing privileges previously included with traveler status or premium fares. One victim of fare unbundling and changes to status offerings is the potential for your travelers to lose access to airport lounges, which many rely on to make business travel less stressful and more productive.

Like transportation, the hotel industry will see only modest rate increases in 2026, with some exceptions.

There is a growing demand for high-end accommodations, including those with social-sharing potential (particularly for meetings and events), driving rate increases in this category, which will be compounded by leisure travelers seeking out luxury accommodations. Accessible and inclusive accommodations, including those with the ability to cater to dietary restrictions and preferences, will also see increased demand and rates.

In North America, rates are quite country-specific, as the US experiences a projected decrease in inbound demand that will temper rates. Mexico will see increased demand, but rates will be stable thanks to increasing supply. The largest rate increases in North America will come in Canada, particularly Toronto.

Relationships with your preferred hotel suppliers will only increase in importance as you create a future-focused program that can withstand volatility. Continue using captured data to build a strategic program that works for your business and your travelers. Consider using rate cap management to deliver savings as well.

The rate stabilization we first saw in 2024 remained through 2025 and will continue into 2026. Car rental rates in the US and Canada will see modest increases, ranging from 1.5% to 3%. Some European countries will be impacted by larger rate increases, such as 5% to 7% in the UK and 4% to 6% in Belgium.

Although rates are stable, businesses can use this year to streamline their car rental program. Partner with a limited number of rental agencies to build strong, strategic relationships. Consider unifying car rentals across the entirety of your organization, moving beyond travel to other departments with rental car policies, such as operations, for additional insights and opportunities. Ride shares are also a viable option, with traceable spend that simplifies expense management through partnerships like Uber for Business. Gen Z and millennial business travelers in particular may appreciate the option to opt for ride shares over rentals, improving traveler satisfaction.