May Consumer Price Index Report: Inflation Rises Again
Travel is not getting cheaper.
Strong demand after two years of pandemic shutdowns and other factors pushed up already high airfare and hotel prices last month, both hitting record highs.
Flight prices in May were up almost 13% from the previous month and almost 38% from May 2021. Hotel prices increased only slightly from April to May, but increased by 22% compared to the previous year.
The price of a night in a hotel, motel or other form of out-of-home accommodation has risen relatively steadily over the past three decades, although it has fluctuated when travel demand has been disrupted by the terrorist attacks of September 11, the financial crisis of 2008 and the coronavirus pandemic.
Airfares have been more erratic, stagnating for years after the 2001 terrorist attacks. Ticket prices rose steadily from 2009 to 2013, when prices peaked. In the years that followed, however, rates slowly declined, then plunged as the pandemic took hold.
“If you look at pricing, where they’ve come up a lot from pre-pandemic lows, in real terms our pricing in the second quarter is going to be pretty much back to where it was in 2014,” said Scott Kirby, director General of United Airlines. , said at an investor conference last week.
The average price for a round-trip domestic flight is $403, up 33% from the same period in 2019, according to Hopper, a travel booking site. International trips cost an average of $1,039, up 17% from 2019.
Demand for flights is particularly high this year as pandemic restrictions have been removed or eased across much of the country. Many people have also been keen to shift their spending from goods to services after having traveled little over the past two years. Fares have also increased due to the rising cost of jet fuel. Airlines have also been cautious about adding too many flights this summer, fearing tight schedules will make it difficult to outrun the disruptions, prompting a repeat of several disastrous episodes last summer and over the winter break. .
Weekend getaways are especially popular this summer, as travelers take shorter trips than before the pandemic, according to Hopper. In the United States, Atlanta, Denver, Las Vegas, Los Angeles, Miami and San Juan, PR are popular weekend destinations. Popular international destinations include Cancun, Mexico; Mexico City; Vancouver, British Columbia; and Toronto.
Hopper found that fares for flights later in the summer are generally cheaper than early in the season. Travelers can save more than $100 each on the cost of a domestic flight and hotel stay if they plan trips in late August rather than June or July.