Americans are traveling in droves—and they are opening up their wallets to make it happen. Airlines Reporting Corp. (ARC) this week released data showing total air ticket sales for the first six months of 2023 were 27 percent higher than the first six months of 2022 and down 0.3 percent compared to 2019. Total passenger trips were up 11 percent over the same period compared to 2022 and down 12 percent compared to 2019. That means, compared to 2019, the average cost per ticket is up about 13 percent ($253.47 in 2019; $288.75 in 2023).
For June 2023, U.S. travel agency air ticket sales increased 2 percent year-over-year to $8.1 billion. June also marked the third month in a row that the average price of a U.S. round-trip ticket was below year-over-year levels, which could signify prices returning to a more “normal” range.
For the year, international travel has seen the biggest improvement from January to June, with the total number of international trips settled through ARC increasing 22 percent year over year, compared to a 5 percent growth in domestic trips.
And, while ARC’s available data only runs through June, research from TripIt confirms what the industry already knows: Summer travel is at near-record levels. TripIt’s data from July showed that domestic flight bookings were up 42 percent compared to 2022, while international flight volume increased 41 percent. In August, domestic travel is pacing to grow 75 percent over 2022, while international flights will increase 78 percent. Heading into shoulder season, international flights will be up 100 percent over 2022, while domestic flights are just behind at 98 percent. Trip length will also increase over the three-month period.
Looking at Europe specifically—which has been one of the top destinations for Americans flocking abroad this year—international tourist arrivals are expected to reach 95 percent of 2019’s levels this year. In fact, one-quarter of countries have already surpassed pre-pandemic levels of foreign arrivals. According to the European Travel Commission’s (ETC) Q2 report, although inflation and increased travel costs are squeezing consumers’ wallets, travel spending is still prioritized over other discretionary expenses.
One challenge to keeping at this pace of recovery is airline capacity. Although the ETC suggests current schedules will be sufficient, many airline and airport workers in Europe are planning strikes in the summer months, which have already had a negative effect on air travel. In addition, the U.S. air travel system has been nearing its limits according to the U.S. Travel Association.
(Along those lines, Forbes Advisor compared the nation’s 100 busiest airports as well as the biggest U.S. airlines to determine the worst for lost, damaged and mishandled baggage. The results: John F. Kennedy International Airport ranked as the worst airport for lost and damaged luggage, while American Airlines was worst for most mishandled bags.)
That said, some relief should be coming to the U.S. air travel system. The House of Representatives this week passed the bipartisan Securing Growth and Robust Leadership in American Aviation Act (the Federal Aviation Administration reauthorization bill). It will help by including directives to increase air traffic controller hiring targets; establishing a workforce development program to educate, recruit and retain aviation professionals; raising the commercial airline pilot retirement age from 65 to 67; and giving directives to the Department of Transportation (DOT) to set standards for aircraft boarding and deplaning for individuals with disabilities; and more.
The legislation would also significantly elevate the voice of travel advisors within the government. The bill also makes clear that the travel agency’s obligation to issue a client refund is limited to scenarios where it is in possession of the funds in question; expands the Aviation Consumer Protection Advisory Committee by adding a dedicated travel agency seat; requires DOT to implement a streamlined system for fulfilling consumer disclosure requirements during “offline” transactions; and creates a new Passenger Experience Advisory Committee with a seat set aside for ticket agents among its membership.
The bill still needs to be passed by the Senate, which is working on its own version of the legislation. The deadline to have it approved is September 30.
Travel to Central and South America
To help your clients avoid the crowds in Europe, perhaps consider another destination—such as Central and South America.
Of note, Abercrombie & Kent (A&K) has expanded into Costa Rica with the opening of a destination management company (DMC). According to Martin Froggatt, chief destination officer at A&K Travel Group, "Costa Rica consistently ranks as a top seller among our Central American destinations, it made perfect sense to set up operations here. Now, we're ready and enthusiastic to design outstanding travel experiences that deeply connect visitors to the distinct features of this remarkable destination."
In addition, through a collaboration with a local Peruvian community, Intrepid Travel has developed a new section of the Quarry Trail, previously unseen by travelers. Over the last few years, the 16-mile Quarry Trail in the Andes Mountain region of Peru has gained recognition as an off-the-beaten-path alternative to the Inca Trail, ending at Machu Picchu. The trail begins in the town of Ollantaytambo and winds through the high peaks and villages of the Sacred Valley.
Travel to Ecuador also just became more accessible. As a result of recently signed agreements by the government, flight tickets to and from Ecuador will be priced at lower costs due to now decreased fees and taxes. “As of today, we have eliminated unnecessary barriers for tourists to come and explore Ecuador,” said Niels Olsen, minister of tourism of Ecuador. “We used to be one of the most expensive countries to visit due to all the fees and taxes created by previous governments that made flying excessively expensive. Under our current government, we have signed the 'Open Skies Agreement,' and reduced the Eco Delta and Tourism Potential taxes that added fees to flight tickets. We are pleased to share this announcement as our main goal is to continue expanding our country’s connectivity to the world and welcoming new short-term and long-term visitors.”
As well, Avianca Airlines has completed the reconfiguration of 104 Airbus A320 aircraft, increasing capacity by 20 percent per aircraft. This will allow the airline to offer more competitive prices, transport more passengers per aircraft, contribute to the decongestion of some airports and reduce CO2 emissions per passenger transported.
A Moment of Your Time
Travel Agent has launched the first iteration of its quarterly "Travel Trends & Advisor Insight Survey." We will use these quarterly surveys to learn more about the current state of the travel industry, as well as your business. Please take a few minutes to fill out the survey; following its conclusion, we will publish the findings here, so you will gain insight into the larger travel ecosystem and your colleague's businesses.
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