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2012 Egencia, LLC. All rights reserved. Expedia, Egencia, and the Egencia logo and Get Ahead are eitherregistered trademarks or trademarks o Expedia, Inc. in the U.S. and/or other countries. CST #2083922-50

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2012 Global Supply Benchmarking Research and Analysis

For air travel, North American points-o-sale, ATPs (Average Ticket Prices) or NorthAmerica showed increases in nearly allbusiness destinations due to increasing costpressures, especially higher uel prices anda limited increase in supply.

For air travel, European points-o-sale, ATPsor European destinations increased 5.8%YoY (compared to a decrease o 8% YoY in2011). The increased ATPs can be attributed

to rising uel prices and tightly managedcapacity by airlines.

For air travel, ATPs or intra-APACdestinations increased 3% YoY.

The hotel environment worldwideexperienced an Average Daily Rates (ADRs)increase in the majority o destinations.ADRs increased an average o 6% in NorthAmerica, 3.3% in Europe, and 5.7% in Asia-Pacic.

For the Supply Landscape or Car Rentals,rates per day have allen 2.4% YoY in Q1 o

2012.

This guide examines both the senvironment at a market-level in North America, Europe, and as well as the results o researc300 global travel buyers. In addprovides recommendations andon how to manage travel progra2012 supply landscape.

2 Air Fares Overview

NorthAmericaEurope

Asia-Pacic

7 Global Hotel Landscape

Reviewfrom50globalmarkets

12 Car Rental Landscape

Based on Egencias Q1 global supply research, the ollowing is a summary o the 2012 prenvironment:

13 Travel Manage

Reviewofreseatravelbuyers

NegotiatingenviChallengesfacintoday

14 Research Meth

TableofContents
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Air Fares Overview

North America

As a result o increasing cost pressures,especially due to higher uel prices, airlineshave continued to tightly manage capacitydiscipline in 2012. This has resulted in anincrease in average ticket prices.

North American destinations with thelargest increases include Minneapolis(up 12.5%), Atlanta (up 11.4%) andPhiladelphia (up 9.3%).

European and APAC destinations rom

NA saw sharp decreases in ATPs,including Paris (down 19%), Hong Kong(down 14%) and London (down 13%).

Higher uel prices have resulted inupward pressure on ticket prices or majorNorth American destinations. Airlines willcontinue to try to pass along increasinguel costs.

November 2011 American Airlinesdeclared bankruptcy; there is a potential

or an American Airlines merger with USAirways in 2012.

The pricing landscape has made anoticeable although less pronounced shit rom this time last year. Wecontinue to see a return in demand orhotels alongside air. Even though ATPsand ADRs have increased, opportunitiesor savings can still be ound.

In addition to the opportune car pricinglandscape, travel managers should lookto their travel management companies toidentiy additional savings opportunitiesin hotel.

Chris VukelichVice President, Supplier RelationsEgencia Americas

NA POSATP Change

YoY

2012 Q1

ATP

NA POSATP Change

YoYAtlanta 11.4% $364 Phoenix 3.9%

Boston 5.2% $353 San Diego 3.4%

Calgary 6% $721 San Francisco -0.8%

Chicago .1% $349 Seattle 5%

Dallas 9.8% $418 Toronto 9%

Denver 4.2% $328 Vancouver 6.7%

Houston 8.6% $439 Washington DC 6%

Los Angeles 0.9% $370 TOTAL 6%

Minneapolis 12.5% $452 Hong Kong** -14%

Montreal 7.1% $695 London** -13%

New York 7% $350 Paris** -19%

Philadelphia 9.3% $403 Tokyo** -2%

Sources:ARC, Smith Travel Research, OAG, E xpedia Internal Analysis

**ARC data or trans-Atlantic/Pacic fights (NA origin)

ATPs or Intra-NA Travel

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EuropeContinued economic concerns, low costcarriers, and more choices in transportation

methods (car and rail) are keeping overallEuropean prices in check. ATPs rom EuropePOS to North America destinations haveallen relatively sharply.

Largest increases were in Amsterdam (up15.2%) and Barcelona (up 13.5%).

Prices in several major Europeandestinations are slightly down includingMarseille (down 1.4%) and Munich (down1.1%).

Stockholm and Paris saw larger decreasesin air ticket prices down 12.4% and9.7%, respectively.

Paris ATPs may be down due to highercompetition, especially rom rail. Travelersmight be using train services more otensince the connection to Paris is very welldeveloped, cheaper and less stressul ortravelers.

For Stockholm, there are many low cost

carrier connections available, which couldbe keeping ATPs down.

North American destinations sawdecreases including Chicago (down 11%),Los Angeles (down 16%) and New York

(down 4%).

EU POSATP Change

YoY2012 Q1

ATPEU POS

ATP ChangeYoY

2

Amsterdam 15.2% 238 Marseille -1.4%

Barcelona 13.5% 194 Milan -0.8%

Berlin 7.5% 197 Moscow -0.1%

Brussels 5.2% 301 Munich -1.1%

Dublin 8.1% 233 Paris -9.7%

Frankurt 4.9% 261 Stockholm -12.4%

Glasgow 4.9% 197 TOTAL 5.8%

London 6.3% 223 Chicago** -11%

Lyon 4.1% 253 Los Angeles** -16%

Madrid 4.2% 220 New York** -4%

Manchester 5% 225 San Francisco** -4%

Sources:ARC, Smith Travel Research, OAG, Expedia Internal Analysis, Local currency

**ARC data or trans-Atlantic fights (European origin)

ATPs or Intra-Europe Travel

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APACPOS

ATPChange

YoY

2012Q1 ATP

DomesticPOS

2012 Q1ATP APAC

POS

APACPOS

ATPChange

YoY

20Q1

DomP

Bangkok 17% $258 $1,205 Singapore -3%

Beijing 13% $433 $1,065 Sydney -4% $

Hong Kong 7% $470 $966 Taipei -6%

Jakarta 4% $386 $935 Tokyo -11% $

Manila 6% $132 $1,101 TOTAL 3% $

Melbourne 2% $350 $1,187 London** 1%

Mumbai 1% $219 $716 Los Angeles** -10%

New Delhi 2% $251 $1,074 New York** -4%

Seoul 0% $174 $1,213 Paris** -11%

Shanghai -2% $435 $1,177 San Francisco** -10%

Asia-PacicAsia-Pacic represents a varied air pricinglandscape, fuctuating on a market-by-

market basis. With uncertainty continuingto play out in the North American andEuropean economies, Asia Pacics ocus ison conducting business within the region.

Largest increases were in Bangkok (up17%), and Beijing (up 12.5%).

Many North American/EMEA destinationprices were down: Los Angeles (down10%), San Francisco (down 10%) andParis (down 11%).

Some markets also showed decreases dueto increased competition in the local marketsand increased capacity on a majority oroutes, as more and larger aircrat enter theAsia Pacic region.

Low cost carriers are continuing theirexpansive presence on domestic andinternational routes, while incumbent majorcarriers ace losing market share. For someintra-APAC, mid-haul routes, a decrease in

business class uptake is also contributing todecreases in ATPs.

Tokyo and Taipei saw the largestdecreases down 11% and 6.1%,respectively.

Other major APAC destina lesser decrease in price(down 4.3%), Singapore (

Shanghai (down 1.7%).

Sources:ARC, Smith Travel Research, OAG, Expedia Internal Analysis, Local currency**ARC data or trans-Pacic/Atlantic fights (APAC origin)

ATPs or Intra-APAC Travel

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Considerations or the Travel Buyer

Consolidate Bookings

Airlines are more agreeable to negotiatingdiscounts i bookings are consolidated,supported by strong policy tools and backedby reporting and historical data. Airlinepartners will want a concrete demonstrationthat travel buyers have implemented strongpolicy controls to increase share and targetincentive goals, allowing corporations to shitbusiness to preerred partners.

While buyers should ask or increaseddiscounts or consolidated share, current

trends have created an environmentwhere airlines are less willing to expandexisting discounts without expandedshare.

In addition to ares, consider negotiatingairline amenities and perks, such aswaived baggage ees, status matches andcabin upgrades.

Companies with international businessmay want to seek lane ares and/or fat

ares, which deliver better discounts thanstandard percentage discounts.

Book EarlyIn an era o constrained capacity and risingticket prices in many markets, booking in

advance remains even more critical. Whilenot every trip is planned early, encourageyour travelers to book as early as possible toget their choice o route options and lowerticket prices.

Streamline Pre-Trip ApprovalProcessesBecause o constrained capacity and areaccessibility, its important that organizationsrespond quickly and eciently to passenger

requests. By responding in a timely ashionto trip approval requests, companies canensure that their travelers can book andconrm lower priced tickets.

Monitor Airlines AncillAirlines continue to grow threvenue, lessening the pres

the ull value o a trip solelyticket prices. Ancillary revenbaggage ees, reservation cand miscellaneous operatinstandby passenger ees.) Tshould ensure they researco a trip with a particular cacomparison shopping, and sopportunities to negotiate dancillary ees that are mostthem.

From an operational perspective, thebeginning o 2012 was overshadowedby United and Continental convertingto a single passenger service system,website, and loyalty program. In addition,the combined carrier made numerouschanges to policies and procedures.

Although much o the travel experiencehas returned to normal service levels,we recommend you contact your travelagency account manager or United ordetails on these and other changes.

Mathias EichelbergerDirector, Air and Transport NAEgencia

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Take Advantage o IncreasedCompetitionCertain global markets and routes are

experiencing pricing battles betweenestablished and/or low cost carriers. Thiscan represent an opportunity or savings,but organizations should be cognizanto ticket restrictions rom many low costcarriers while ensuring they are comparingtotal prices, which include ancillary ees,when shopping or tickets.

Also, some hidden costs o fying low costairlines should be considered, such as timeto travel to ar away airports, waiting time atairports, fight requency, and the quality osupport in case o disruption.

Be FlexibleEducate your travelers on the value o beingfexible in their travel plans. By opting to

travel to leave slightly earlier or later, or tomake one stop versus a direct fight, theycan nd additional savings on air ticketprices.

SummaryI a company can bring increopportunities to a carrier, in

discounts are possible, thoucontinue to be a challenginsuccessul negotiations, tramust have a good understatravel spend, use strong pohave historical data in placetheir travel program. While o service will receive discomanagers should look to otvalue, such as waived ees, status matches.

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NorthAmerica

ADRChange

YoY

2012 Q1ADR

North AmericaADR

Change YoY

Atlanta 2.4% $96 New York 2.8%

Boston 6.4% $158 Philadelphia 2.3%

Calgary 5.6% $145 Phoenix 4.1%

Chicago 5.9% $110 San Diego 2.2%

Dallas -7.0% $97 San Francisco 13.9%

Denver 1.9% $97 Seattle 3.4%

Houston 3.8% $103 Toronto 2%

Los Angeles 3.6% $130 Vancouver 2.4%

Minneapolis 3.6% $97 Washington DC -1.5%

Montreal 1.8% $123 TOTAL 6.0%

Global Hotel Landscape

With improved occupancy appearing

in almost every top business marketworldwide, average daily rates (ADRs)have increased in the majority o businessdestinations, continuing to reverse aprevious trend o declines.

North America destination ADRs wereup across the board, with the largestincreases in San Francisco (up 13.9%),and Boston (up 6.4%).

In Europe, markets that showed solid

rate increases included Stockholm (up9.2%), Dublin (up 6.5%) and Marseille(up 6.3%). Given all o the economicuncertainty over the past year, the hotelsegment in Europe seems healthy,although o all 3 super regions (NA,APAC, EMEA) it appears to have theweakest growth.

*Percentage and euro/dollar amounts are based on Expedia research citing leisure and corpotravel combined.

Reviewing fgures or 2012, we haveseen clients tighten their belts this yearand shit more o their negotiated hotelvolume into 3 stars and below.

For a number o large markets likeManhattan, Chicago, San Francisco

and Los Angeles, we have also seen anincrease o business travelers choosingto stay at airport properties in an eort tokeep travel costs down.

Steve Peterman,Director Hotels North AmericaEgencia

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ADRs in Asia-Pacic desgenerally increased, espe(up 23.6%), Seoul (up 15

Kong (up 12.4%). For themarkets (Singapore/Hondemand growth and limitcontinue to uel ADR gro

Australia, although acingdemand and no increaseseen little change. Price-is down across the boardperormance in smaller elike Seoul, Jakarta and Tvery strong.

Dublin continues to rebomassive price alls duringwith 2011 growth continualthough the pace will mbit.

Moscow ranks as one oexpensive cities or hotestrong growth here also growing overall demand

EuropeADR Change

YoY2012 Q1

ADREurope

ADR ChangeYoY

2012 Q1ADR

Amsterdam 2.6% 111 Madrid -2.1% 82

Barcelona 2.3% 101 Manchester -1.7% 75

Berlin -1.5% 83 Marseille 6.3% 81

Brussels 1% 109 Milan 2.0% 120

Dublin 6.5% 81 Moscow 5.1% 165

Frankurt -3.9% 122 Munich -1.1% 102

Glasgow 1.7% 70 Paris 5.5% 140

London 2.8% 139 Stockholm 9.2% 123

Lyon -1.8% 86 TOTAL 3.3%

*Percentage and euro/dollar amounts are based on Expedia research citing leisure andcorporate business travel combined.

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Stockholm also leads in tADR growth; rates contineven though occupancy

to slightly down. These gSwedens relatively stronthe recession.

Current ADR results or refect the upcoming Olyevents in the city or the o July and August.

Since 2010, Hong Kong consistently strong markoccupancy rates and stelead to higher ADR YoY.

Jakartas perormance isstrong. This could be dueit undamentally had oneADR values in absolute te

APACADR

Change YoY2012 Q1

ADR (USD)APAC

ADRChange YoY

2012 Q1ADR (USD)

Bangkok 5.2% $90 Seoul 15.4% $162

Beijing 3.4% $101 Shanghai -4.6% $108

Hong Kong 12.4% $214 Singapore 7.4% $217

Jakarta 23.6% $122 Sydney 0.1% $207

Melbourne 1.6% $188 Taipei 8.3% $137

Manila 0.1% $106 Tokyo -3.2% $153

Mumbai -3.1% $158 TOTAL 5.7%

New Delhi -1.7% $142

*Percentage and euro/dollar amounts are based on Expedia research citing leisure and corporate businesstravel combined.

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Considerations or the Travel BuyerNow is the right time to establish or updatepreerred supplier strategy, which can be

achieved through the ollowing tactics:

Consider Independent HotelsWithout the need to subsidize costly loyaltyprograms, these properties may oer betterrates and amenities.

Leverage Hotels That Oer Free orDiscounted AmenitiesEncourage travelers to book at and leveragehotels with ree amenities such as Internet

service, shuttle service, breakast, andhosted evening events.

Negotiate or Better Terms andConditionsFavorable cancellation terms or decreasedearly checkout ees can add up tosignicant savings.

Monitor Your ProgramMonitoring creates visibilitytravel manager stay ahead

practices. Accessible travelcan help companies negotiand volume discounts, by pclarity o:

Travelers who routinely o

Underutilization o speci

Top cities or the travel p

Analyze SpendAnalyze your total hotel spemarket and on a regional babest practice is to try and cone hotel or every 250 rooparticular property.

Negotiate Last Room AvailabilityClausesThis means that properties must oer

negotiated rates even i only one roomtype is available, resulting in lower ADRsthroughout the year.

Regularly Upgrade Room CategoryPricingThe ADR ceiling or cap in large metropolitanmarkets can be tight due to city wide sell-outs, which are more common in thesebusiness hubs.

Property-Specic AgreementsProperty-specic agreements typicallylead to better savings. While chain-wideagreements provide the advantage oa regional discount to companies withgeographically dispersed travel patterns,property-level agreements at individualchain properties oer greater discounts.Chain-wide agreements are also verydicult to negotiate without signicanttravel spend.

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Provide SupportBy demonstrating a consistent eort todrive share towards preerred suppliers,

corporate travel buyers have a strongerplace at the bargaining table. Mandatingbookings via an agency o record will alsoaid in this discussion.

Consider Department-SpecicRestrictionsBy segmenting traveler groups,organizations can still provide a solid levelo service and amenities while decreasingcosts.

Consider TimingCorporate travel buyers may have moreavorable results when the negotiation is

timed during a slower period or the hotel.

Work With Your Travel ManagementCompanyWork with your Travel ManagementCompany (TMC) to take advantage opowerul discounts and perks. In manycases, TMCs can consolidate the buyingpower o a broad range o clients and oerbenets that companies may not be able toachieve on their own.

SummaryNow is the time to work witpartners. Companies that c

incremental demand may bnegotiate avorable agreemrates continue to rise, thereopportunity to negotiate orare meaningul to your trave

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Car Rental Landscape

Overall or North America, rates per dayhave allen YoY (-2.4% in 2012) dueprimarily to a highly competitive marketplaceand abundance o supply.

Considerations or the Travel BuyerEven with the improving environment, carcompanies will demand value rom accountsin exchange or discounts. I companiescannot meet their revenue commitment,discounts will be reduced. But i a companycan bring additional business to the table,the buyer is in a very good position to

negotiate.

In addition to ocusing on discounts,buyers should also prepare data thatallows a company to negotiate additionalcost savings. Insurance, drop-o ees,and surcharges are all areas that deserveadditional ocus. Buyers should alsocompare ees across vendors and use thedata in negotiations.

Also, be sure to leverage multiple datasources. Typically, expense systems onlyprovide the amount spent and the location,

but will not provide all the details needed ornegotiations with vendors.

SummaryDriving policy enorcement car rental bookings will allo

accounts to realize savings compliance and by negotiat

preerred vendor agreemen

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Travel Management Trends

According to respondents o Egenciassurvey o over 300 travel buyers worldwide:

43% o buyers expect their travel volumes(number o trips) to increase during theremainder o 2012 (compared with 54%in 2011) with 46% expecting their overalltravel spend to increase.

Additionally, 62% o travel buyerssaid they will negotiate more in 2012(compared to 38% in 2011).

Travel Managers universally identied costcontrol/reducing spend as the greatestchallenge acing their travel programs.

Specic rankings o travel programchallenges are as ollows:

Cost control/reducing expenses (77%)

Traveler compliance/policy enorcement(40%)

Capturing a ull view o travel spend(38%)

Increasing traveler satisaction (35%)

Top cost control measures include:

Reviewing and enorcing corporate travelpolicy (68%)

Requiring advance purchase (56%)

Requiring lowest logical are purchase(49%)

Even as companies try to hotravel spending, they are alstraveler satisaction; possibl

to an increasing willingnesstravelers to ront o cabin trrst class) on fights lastinghours.

In act, Egencia ound that 4business travelers are permin ront o cabin seats on fighours, compared to just six business travelers on fightsnine hours. Allowing or bustravel may be emblematic o

wanting to be seen as suppemployees, not just cutting

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Research Methodology

Data and insight based on the statisticalanalysis o the past and present industrytrends, macroeconomic actors, marketresearch and vendors capacity orecastsor 2012. Smith Travel Research (STR) andExpedia data were leveraged or a market-level analysis o both Lodging and Aircapacity. ARC, STR and Expedia InternalData were used or market-level analysis opricing.

Average Ticket Price Calculations Average Ticket Price (ATP) is the average

airare paid by consumers including taxes

and ees Based on roundtrip, coach class tickets to

the listed destinations

ATPs are in local currency, based uponthe point-o-sale and are weighted by

ticket share or that point-o-sale

Average Daily Rate Ca ADR or Average Daily

average daily rate paid o

including taxes and ees Based on date o stay in

destinations

ADRs are in local currenthe point o supply

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