Soaring inflation threats to travel plans for millions of Americans, as surgent demand for trips and vacations drives prices higher.
On Saturday, gasoline hit a new record high of $4.45, and the start peak summer travel season is still several weeks away.
Earlier this week, federal inflation data showed that airfares are up 33 percent from a year ago, jumping 18.6 percent from March to April alone, in the quickest increase since records began in 1963.
Analysts at travel comparison company Hopper estimate that roundtrip domestic flights are now averaging $330, as compared to $235 at the beginning of 2022.
On Saturday, gasoline hit a new record high of $4.45, and the start peak summer travel season is still several weeks away
Hopper predicts prices will increase at least 10 percent to $360 by the end of May and remain that way through June.
And prices for kids summer camps will be up 10 percent to 15 percent from a year ago amid strong demand, estimates Tom Rosenberg, president and CEO of the American Camp Association.
‘Demand is extremely strong for camps as parents are desperate for their kids to be out in nature with their peers and away from tech devices after two years of social distancing,’ he told CNN Business.
Still, surging costs aren’t deterring summer vacations, and about 85% of Americans are expecting to travel this summer, according to the US Travel Association.
Expedia CEO Peter Kern told Bloomberg that he expects the summer of 2022 ‘will be the busiest travel season ever.’
Airlines, hotels, rental car companies and booking sites all reported a surge in demand for their services in the latest batch of company earnings.
But at the same time. many of those companies face a tight labor market and limited volume as they scramble to restart and expand operations after more than two years of depressed demand due to the pandemic.
Earlier this week, federal inflation data showed that airfares are up 33 percent from a year ago, jumping 18.6 percent from March to April alone
Prices for kids summer camps will be up 10 percent to 15 percent from a year ago amid strong demand, an industry group predicts
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 versus later can mean locking in better prices.
Hilton Worldwide Holdings Inc plans to continue to reprice hotel rooms ‘every minute of the day’ to limit the impact inflation has on its business, CEO Christopher Nassetta told investors on Tuesday.
‘As demand has picked up, we have certainly been able to do that and we expect that 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 percent higher in the first quarter of 2022 compared to the same period in 2021.
Average daily rates across hotel companies in the US were up approximately 37.7 percent in the first quarter of 2022 when compared to the same period in 2021, according to hotel market data provider STR.
The price of flights this summer are also trending higher, according to travel search engine Skyscanner.
Round trip flights within the US will cost $302 per traveler on average, which is 3 percent higher during the same period pre-pandemic.
Long and ultra-long-haul international flights are up to 20 percent higher than 2019, costing on average $797 and $1182 respectively.
Other segments within 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 versus later can mean locking in better prices
Car rental firm Hertz Global Holdings reported it averaged about 481,000 vehicles during the first quarter of 2022 compared to a pre-pandemic level of approximately 700,000 vehicles.
‘There’s little question that as demand moves even higher in the summer season, you’ll see stress further,’ said Hertz CEO Stephen Scherr, adding that the available supply of vehicles is limited and needs to be managed very carefully.
Staffing woes 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 scheduled to operate at between 75 percent to 95 percent of their 2019 summer capacity from May through August.
The Transportation Security Administration (TSA) continues to host hiring events in an effort to increase staff ahead of anticipated summer travel and the return to pre-pandemic passenger volumes, according to a statement from the agency.
The TSA in March said the return of (fiscal year) 2019 passenger traffic levels would return in (fiscal year) 2022, a year earlier than previously projected and an increase in staff will help ensure that the ‘traveling public does not experience excessive wait times .’