US booking sites see strong demand for travel in 2022

Passengers carry their luggage at John F. Kennedy International Airport during the spread of the Omicron variant coronavirus in Queens, New York City, U.S. December 26, 2021. REUTERS/Jeenah Moon

March 18, 2022

By Doyinsola Oladipo

(Reuters) – U.S. booking sites like Vrbo, Hopper and KAYAK are seeing higher demand for leisure travel in the spring and summer as COVID-19 restrictions ease and travelers seem to shake the additional cost of plane tickets and road trips due to rising fuel prices.

“We are seeing strong booking activity for Spring Break and the start of a very strong summer,” said Jamie Lane, VP of Research at AirDNA, which tracks the daily performance of over 10 million properties from vacation rental companies Airbnb and Vrbo.

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

According to AirDNA data, the booking pace for spring travel in the northern hemisphere is 49% faster than this time last year and 26% faster than before the 2019 pandemic.

“The rush for summer vacation home bookings has accelerated further in 2022,” Vrbo said in a statement earlier this month. The vacation rental booking platform reports that demand for property has already exceeded last summer by 15%.

“By reviewing booking data, it’s clear that Omicron was a bigger concern for travelers than rising fuel costs,” said Dakota Smith, chief strategy officer at Hopper, a travel booking app.

Popular with younger travelers, the app has seen a 50% increase in travel bookings since the fourth quarter of 2021.

Airlines anticipate strong demand to cope with rising fuel costs. Some airlines intend to pass much of this increase on to customers.

“With gas prices hitting record highs, jet fuel prices may not lag far behind…this summer travel season could be expensive,” said Paul Jacobs, GM and VP of KAYAK North America. Airfares increased by 17% last week compared to the same week in 2019, according to KAYAK.

However, rising fuel costs will have less of an impact on domestic and short-haul flights, and there are signs that U.S. travelers’ preference for these pandemic-era trips is lingering and may remain so while the war in Ukraine drags on, Hopper’s said Smith .

According to Hopper, U.S. bookings to Europe have fallen to 15% since Feb. 12 from 21% of Hopper’s international bookings, with international bookings shifting to Mexico, Central America and the Caribbean. Those locations now account for 61% of Hopper’s international bookings, according to Smith. Europe accounted for approximately 30% of Hopper’s international bookings in 2019.

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

Investors will also get another look at the leisure travel recovery when Carnival Corp reports earnings on Tuesday. According to data from Refinitiv, Carnival is expected to post a loss of $1.21 per share on average as revenue climbs to over $2 billion.

(Reporting by Doyinsola Oladipo, Editing by Rosalba O’Brien)