Despite expensive plane tickets, travel has become a priority

The boom in tourist travel after the pandemic and high prices of plane tickets show no signs of slowing down in the coming year, despite economic uncertainty and dwindling household savings.

According to the International Air Transport Association, air travel has reached 90 percent of pre-pandemic levels this year. The recovery has been led by visitors to Southern Europe from colder climates despite high temperatures, as well as American tourists.

– After the pandemic, many people have changed their priorities and focused on spending on travel – said Dan McKone from L.E.K. Consulting.

This could intensify further next year. A recent survey by Amadeus shows that 47 percent of respondents consider international travel a priority in 2023 and 2024, compared to 42 percent who thought so last year. Amadeus conducted the survey among travelers from the UK, France, the US, Germany, and Singapore.

Such trends have increased quarterly earnings for travel companies, and cruise operators like Royal Caribbean have reported record results. Travel operators Booking Holdings and Airbnb announced that their revenues increased by 27 percent and 18 percent, respectively, while airline Delta and hotel chain Marriott International expect strong future demand.

German carrier Lufthansa announced that bookings for the remainder of the year exceed 90 percent of pre-pandemic levels and that the summer season is extending into October. United Airlines is expanding its Pacific coverage this fall with new flights to Manila, Hong Kong, Taipei, and Tokyo.

Overall, it is estimated that global travel demand will increase by 22 percent year-on-year in 2023 and by six percent in 2024, according to Moody’s. It is unlikely that ticket prices, which in some cases have risen by double digits since the pandemic, will suddenly drop.

Hayley Berg from the online travel agency Hopper does not expect significant price reductions for travelers to Europe and Asia this fall. She estimates that prices for long-haul international flights will remain high until supply exceeds pre-pandemic levels, demand normalizes, and fuel prices decrease further.

A weak point is domestic travel in the US, as the end of COVID-19 testing restrictions has unleashed pent-up demand among Americans for vacations abroad.