March 23, 2022

US Booking Sites Seeing Strong Demand for 2022 Travel

US booking sites including Vrbo, Hopper and KAYAK are seeing higher demand for spring and summer leisure travel as Covid-19 restrictions ease and travellers appear to be shrugging off added costs to plane tickets and road trips from rising fuel prices.

"We are seeing strong booking activity for spring break and the beginnings of a very strong summer," said Jamie Lane, VP of research at AirDNA, which tracks the daily performance of over 10 million properties on vacation rental firms Airbnb and Vrbo.

Oil has soared over US$100 a barrel as Russia's invasion of Ukraine jolted global markets. But US carriers including Delta Air Lines, United Airline Holdings and American Airlines this week reported a strong rebound in travel demand after the blip caused by the Omicron coronavirus variant.

AirDNA data said the booking pace for travel in the northern hemisphere spring is 49 per cent higher than this time last year, and 26 per cent higher than pre-pandemic 2019.

"The rush to book summer vacation homes has further accelerated in 2022," said Vrbo in a statement earlier this month. The vacation rental booking platform reports demand for properties is already outpacing last summer by 15 per cent.

"When reviewing the booking data, it's clear that Omicron was a bigger concern for travellers than rising fuel costs," said Dakota Smith, chief strategy officer at Hopper, a travel booking app.

The app, which is popular among younger travellers, has seen a 50 per cent increase in travel booking since fourth-quarter 2021.

Airline carriers are counting on strong demand to deal with the rising fuel costs. Some airlines intend to pass along a majority of that increase to customers.

"As gas prices reach record highs, jet fuel prices may not be far behind... this summer travel season may be a pricey one," said Paul Jacobs, GM and VP of KAYAK North America. Flight prices were up 17 per cent last week compared to the same week in 2019, according to KAYAK.

The rising fuel costs will have less impact on domestic and short-haul flights, though, and indications are that the pandemic-era preference from US travellers for those trips is continuing, and may remain while the war in Ukraine drags on, said Hopper's Smith.

Hopper said US bookings to Europe have dropped from 21 per cent of Hopper's international bookings to 15 per cent since Feb 12, with international bookings shifting toward Mexico, Central America and the Caribbean. These locations now represent 61 per cent of Hopper's international bookings, according to Smith. Europe accounted for approximately 30 per cent of Hopper's international bookings in 2019.

Business travel and travel to urban locations has yet to recover to pre-pandemic levels, according to AirDNA.

Investors will also get another view on the recovery of leisure travel when Carnival reports earnings on Tuesday. Carnival on average is expected to post a loss of US$1.21 a share, while revenue soars to over US$2 billion, according to data from Refinitiv. REUTERS

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