Americans Want Overseas Summer Vacations Despite Costs and Crowds

Long airport lines, jammed planes, higher fares and potential flight delays are set to plague the coming summer travel season as more Americans fly at home and abroad.

(Bloomberg) — Long airport lines, jammed planes, higher fares and potential flight delays are set to plague the coming summer travel season as more Americans fly at home and abroad.

Even if the industry avoids another meltdown like the one at Southwest Airlines Co. over the year-end holiday period, a shortage of air-traffic controllers at busy airports in the US means travelers aren’t likely to escape headaches that accompany flying during the busiest time of the year.

The number of passengers moving through airport checkpoints has surpassed 2.6 million on several days recently, setting up the Memorial Day holiday in the US for passenger numbers “we haven’t seen since before the pandemic,” Transportation Secretary Pete Buttigieg told reporters Tuesday. 

US carriers will operate 4.5% more flights this year over a seven-day stretch surrounding the May 29 holiday compared to a year ago, the Federal Aviation Administration said, which is 2.6% below the pre-pandemic level in 2019. The three biggest US airlines say they’ll fly 8.6 million people over the period, up nearly 12% from 2022.

Top global destinations for US travelers include London, Paris, Rome, Tokyo and Cancun, Mexico, according to Hopper Inc. and Airlines Reporting Corp., which handles settlement transactions between carriers and travel agents. 

United Airlines Holdings Inc. and JetBlue Airways Corp. are among carriers trimming about 10% of flying at busy airports in greater New York City and Washington at the request of federal regulators because of a shortage of air-traffic controllers. Delays in New York have an out-sized impact on the entire air system because so many flights start or end in the region.

“June through August is always a summer of discontent,” said Bob Mann, president of aviation consultant R.W Mann & Co. “It’s the highest utilization of people and equipment, and it’s the period of highest stress with the least margin for error.” 

Holiday Meltdown 

Consumers will particularly be watching Southwest following its operational crisis in December, when 16,700 flights were canceled over 10 days after a massive winter storm overwhelmed crew scheduling software and stranded flight crews and airplanes, along with more than 2 million passengers. 

The Dallas-based carrier has updated technology and made other changes to better handle storms since the disruption, which triggered scrutiny from lawmakers and US regulators. 

Read More: Southwest Air’s CEO Concedes Brand Was Hurt by December Upheaval

Summer demand is being fueled by the expiration of pandemic travel restrictions outside the US, consumer confidence despite inflation and threats of recession, and the continuing shift in spending away from goods to experiences, according to PricewaterhouseCoopers. 

US airlines say they’re ready, after adding employees and increasing flight capacity. Nearly a quarter of flights were delayed each of the past two summers for nine major US carriers and their regional partners. That compares with just 19% in 2019, a year of record demand. 

“Last summer was very much the summer of domestic travel,” Delta Air Lines Inc. Chief Executive Officer Ed Bastian said on May 17. “This summer is international, and it’s just about any place internationally that people can get to, and it’s off the charts.” 

About 58% of ticket booking searches originating in the US have been for international travel this year, according to booking app Hopper. That’s up four percentage points from 2022 but below the 63% in 2019. Tickets purchased for the 10 most popular international destinations are up 26% on average, ARC data showed. 

Bon Voyage 

American Airlines Group Inc. is devoting 80% of its second-quarter year-over-year capacity growth to international routes, while Delta is increasing seats on non-domestic routes by more than 20% compared with 2022. United expects revenue in the period to increase almost 30% from international flying versus as much as 10% from domestic. 

“International travel, one of the big missing components in the leisure recovery, is a big driver this summer,” said Jonathan Kletzel, head of PwC’s airline and travel practice. 

That means elevated ticket prices. International fares to Europe this summer already are the highest in more than five years, according to Hopper. Fares to Europe are averaging $1,167 round trip, compared with $850 last year and $861 in 2019. 

Trips to Asia are averaging $1,817, higher than both the $1,468 average in 2022 and $1,122 in 2019, Hopper data shows. 

“International is having that huge price run up that domestic saw last year,” when travel surged in the US after the omicron variant of Covid 19 waned, said Hayley Berg, Hopper’s lead economist. 

More bargains can be found at home. Domestic round-trip fares for the summer are averaging $306, down 19% from last year as carriers offer more seats and flights and spend less for jet fuel. But it’s still well above the $288 average circa 2019, according to Hopper. 

Prices are expected to be higher around the Fourth of July holiday but decline for the Sept. 4 Labor Day holiday, the unofficial end to summer leisure trips in the US. 

Half of Americans are planning a summer vacation with paid lodging, up from 46% last year, according to a Deloitte summer travel survey. Another 13% will stay with family or friends. About 37% will fly to international destinations, up 10 percentage points over 2022. Comparisons to 2019 aren’t available because the survey wasn’t done then. 

Among those not planning to travel this year, 50% say they can’t afford it, the Deloitte survey showed.

–With assistance from Ryan Beene.

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