New York
CNN Business
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For travelers preparing to take their first vacation trips since before the pandemic: prepare for sticker shock.
Airfares are on the rise. Gas prices in the United States are higher than they have ever been at this time of year. Rates for hotel rooms and rental cars jumped 12% and 46% respectively compared to 2019.
The good news is that prices for airfare, gasoline and hotel rooms are down from record highs reached earlier in 2022, but they are still among the highest on record for this period of the year. Only rental car prices are lower than what travelers were paying at the end of last year, although they are still well above pre-pandemic levels.
Here’s what’s going to cost travelers more this holiday season:
When air travel came to a virtual standstill in 2020 due to the pandemic, US airlines cut staff through early retirement and buyout packages. Staffing is now approaching pre-pandemic levels at most carriers, but the number of flights and seats available has not returned to those levels.
Data from aviation analytics firm Cirium shows the number of flights scheduled for November and December are down 15% from the same months in 2019. Many of those missing flights were previously operated by small regional carriers serving smaller airports, and some of those airports have since lost service altogether. But even with a higher percentage of flights on larger planes, the number of available seats is down 3.5% compared to the same period in 2019.
A rise in Covid cases at the end of 2021 dented demand for leisure travel, but this year it is positively robust, airlines and industry experts say.
“Holiday travel has come back as strong as ever, and leisure travel is the reason it’s picked up,” said Scott Keyes, founder of travel site Scott’s Cheap Flights. “So many people wanted to travel on Labor Day and July 4, and as we’ll see very soon, on Thanksgiving and Christmas.”
And that combination – high demand and tight supply of seats – means high fares.
The average airfare is up about 40% from 2021, with leisure travelers paying an average of $289 one way, according to an airfare tracker compiled by Wall Street analysts at Cowan.
But it’s not just relative to pandemic prices that fares are higher.
Travel site Hopper says airfares have gone up 7% compared to the same period of 2019, and are up 17% when comparing prices for those who waited a week before Thanksgiving to book a flight.
“Holiday travel is significantly more expensive than what we’ve seen in previous years,” said Hayley Berg, chief economist for Hopper.
Of course, most vacationers never get on a plane — they drive. The AAA estimates that 49 million people will travel by car during the holidays, compared to 4.5 million by air. And for these drivers, gas prices are way off bigger concern than air fares.
The good news is that the national price of a gallon of regular gasoline is well below the record high of $5.02 set in June. AAA reports that the Sunday average was $4.67, down 27%. And prices continue to fall – the average price is down 11 cents per gallon in the past week alone.
But prices are still 8% higher than at the same time last year. The price of gas is usually at its seasonal low at the end of the year, often just before Christmas.
Even with the annual increase in holiday travel, the amount of driving in November and December is generally well below the summer driving season. And many factors are pushing oil and gasoline prices to historic highs around the world this year. The first of these is Russia’s invasion of Ukraine, which triggered sanctions against Russian oil. U.S. refining capacity, which plummeted during the pandemic, has yet to recover.
Average Sunday price of a gallon of gasoline is 46% higher than the average November 20 price over the past 20 years, according to data from OPIS, which tracks gas prices for AAA.
Hotel prices are also more expensive than they have ever been at this time of year. The Consumer Price Index, the government’s main inflation indicator, shows that the cost of out-of-home accommodation hit a record high in May, and the October average, the most recent available, is not down only 2% from that peak.
Prices are up 6% from a year ago and 12% from October 2019. While the CPI does not provide dollar averages for the prices it tracks, Hopper assesses the average price hotel rooms for $189 on Thanksgiving weekend and $218 on Thanksgiving weekend. Christmas week.
Once again, high demand and tighter supply – some hotels have not survived the pandemic, others are still scrambling to find the staff they need to fully reopen – are pushing prices up.
Car rental companies reduced their fleets in the early months of the pandemic, selling the cars they had to raise cash. With automakers still unable to return to full production due to a shortage of parts needed to build cars, including computer chips, it has taken car rental companies a while to replenish their fleets to to respond to the request.
The good news is October CPI data shows car rental prices are down 3.5% from October last year, and down 15% from the record high. established in June 2021. Yet rental cars are 46% more expensive than them. were in October 2019.
Cnn
