The US Centers for Disease Control and Prevention issued a new guide for domestic and international travel on Friday, easing the requirements for people who are fully vaccinated against COVID-19. Travel experts say the vaccine-driven surge in travel bookings could be bad news for anyone looking to get a deal on a summer vacation this year.
“‘There are definitely still some discounts, but they are mainly for companies that are not adjusting quickly enough to the peak in demand that is occurring right now.’ ”- Jordan Staab, President of the Hopjump travel website
Another factor is that carriers significantly reduced their capacity in light of the pandemic. Airlines pulled service planes, closed middle seats and cut the number of flights they fly daily to cut losses with so few people traveling. These companies can’t just flip a switch and get things back to normal because now more people want to travel. “The number of domestic flights is still 30% lower compared to 2019 in April – in other words, supply goes down and if demand goes up, fares will go up,” said Edward Russell, an airline reporter for the US news outlet. Skift travel. Gas prices are another factor. This week, gasoline futures, which are contracts that guide fuel prices in the coming months, hit the highest closing price in more than two years. Travel is expected to resume overall, which means there is more demand for fuel. Airlines will eventually start pricing those higher fuel costs into the airfares they present to customers, Staab said. Another factor airlines should consider when pricing future flights is the excess coupons they provided over the past year. Instead of reimbursing cash to customers who canceled trips due to the pandemic, in most cases, airlines offered coupons. In some cases, those coupons have expiration dates of 2021. And either way, the people who keep those coupons may feel better traveling now and want to redeem them. “Airlines will be looking to recoup some of their losses from last year and will look to raise prices as soon as demand increases,” Staab said. What about international travel? “It’s worth noting that this boom is driven almost exclusively by domestic travel,” said David Slotnick, senior aviation reporter for The Points Guy. It is still difficult to travel abroad due to the precautions in place to limit the spread of COVID-19. The CDC requires that all air passengers, including vaccinated individuals, have a negative COVID test or documentation that they have recovered from the disease before boarding a flight from another country to the US, even if they are US citizens. In fact, flight search data shows more concerns about traveling outside of the United States. Summer domestic flight searches actually exceeded pre-pandemic 2019 volume in late February and have risen 22% since then, according to data from the travel app Hopper. But that’s not the case for international flights. Searches for these trips were still down 45% compared to 2019 levels in early March. “While confidence around international summer travel is improving, we are likely to see a much longer payback time horizon relative to domestic travel,” said Adit Damodaran, an economist at Hopper.