Inflation threatens summer vacation plans for millions of Americans
Soaring inflation threatens the travel plans of millions of Americans as growing demand for travel and vacations drives up prices.
Gasoline hit a new high of $4.45 on Saturday, and the start of the peak summer travel season is still weeks away.
Earlier this week, federal inflation data showed airfares were up 33% from a year ago, jumping 18.6% from March to April alone, in the largest increase fast since records began in 1963.
Analysts at travel comparison firm Hopper estimate that round-trip domestic flights now average $330, down from $235 at the start of 2022.
Gasoline hit a new all-time high of $4.45 on Saturday, and the start of the peak summer travel season is still weeks away.
Hopper expects prices to rise at least 10% to $360 by the end of May and stay that way through June.
And prices for kids’ summer camps will rise 10 to 15 percent from a year ago amid strong demand, estimates Tom Rosenberg, president and CEO of the American Camp Association.
“Demand is extremely high for camps as parents desperately want their children to be in nature with their peers and away from technological devices after two years of social distancing,” he told CNN Business.
Still, soaring costs aren’t discouraging summer vacation, and about 85% of Americans plan to travel this summer, according to the US Travel Association.
Expedia CEO Peter Kern told Bloomberg that he expects the summer of 2022 “to be the busiest travel season ever.”
Airlines, hotels, car rental companies and booking sites have all reported increased demand for their services in the latest batch of corporate earnings.
But at the same time. many of these companies are facing a tight labor market and limited volume as they strive to restart and expand operations after more than two years of depressed demand due to the pandemic.
Earlier this week, federal inflation data showed airfares were up 33% from a year ago, jumping 18.6% from March to April alone.
Prices for children’s summer camps will rise 10-15% from a year ago amid strong demand, industry group says
A customer pumps gas at an Exxon gas station, Tuesday, May 10, 2022, in Miami.
Tripadvisor said travelers should expect inflation to impact all areas of travel purchases in 2022, and booking now rather than later can mean getting better prices.
Hilton Worldwide Holdings Inc plans to continue repricing hotel rooms “every minute of the day” to limit the impact of inflation on its business, CEO Christopher Nassetta told investors Tuesday.
“As demand has picked up, we have certainly been able to do that and hopefully we will continue to be able to do that,” he said on the company’s earnings call.
Hilton’s average daily rates in the United States were 36.4% higher in the first quarter of 2022 compared to the same period in 2021.
Average daily rates for hotel companies in the United States rose about 37.7% in the first quarter of 2022 compared to the same period in 2021, according to hotel market data provider STR.
The price of flights this summer is also trending higher, according to travel search engine Skyscanner.
Round-trip flights to the United States will cost an average of $302 per traveler, or 3% more over the same pre-pandemic period.
Long-haul and ultra-long-haul international flights are up to 20% higher than in 2019, costing an average of $797 and $1,182 respectively.
Other segments of the travel industry are facing supply constraints and labor shortages as leisure and business travelers also return.
Tripadvisor said travelers should expect inflation to impact all areas of travel purchases in 2022, and booking now rather than later can mean getting better prices
Car rental company Hertz Global Holdings said it averaged around 481,000 vehicles in the first quarter of 2022, down from a pre-pandemic level of around 700,000 vehicles.
“There is no doubt that as demand increases further during the summer season, you will see even more stress,” said Hertz CEO Stephen Scherr, adding that the available supply of vehicles is limited and must be handled with great care.
Staffing issues have also marred operations in recent weeks at carriers such as Alaska Airlines and JetBlue, forcing them to cut summer schedules to avoid further disruption.
Travel booking app Hopper said domestic airlines are currently expected to operate between 75% and 95% of their 2019 summer capacity from May to August.
The Transportation Security Administration (TSA) continues to hold hiring events in an effort to increase staff ahead of planned summer trips and a return to pre-pandemic passenger volumes, according to a statement from the agency.
In March, the TSA said the return to (fiscal year) 2019 passenger traffic levels would return in (fiscal year) 2022, a year ahead of schedule and an increase in staff will help ensure the “traveling public does not experience excessive waiting times. .’
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