While many things got more expensive in 2022, travel is one category in which it's easier to cut back. A recent survey found that out of the 43% of American adults who had hoped to travel this holiday season, 80% altered their plans in some way for financial reasons.
Deloitte estimated that only 31% of Americans planned to take a trip between Thanksgiving and mid-January this year. 42% did so in 2021.
The high cost of everything from airfare to hotels is the primary reason for the lower numbers -- at one point in the summer, domestic flights were up 30% since 2019 and 47% since the start of 2022.
While prices evened out slightly during non-peak periods, it's still not looking good overall -- in its annual Air Monitor 2023 report, American Express Global Business Travel predicts that flights within North America will rise 2.9% for economy and 3.4% for business class between 2022 and 2023.
It's Not Looking Good For International Flights
While these reports may be lower than the average consumer price index (7.1% in November) but international flights are where airfare can truly soar -- economy flights are predicted to rise by 12.2% to Africa, 7.8% to the Middle East, 5.5% to Europe and 5.4% to Asia.
The biggest increase is slated to happen on business class flights to Australia. While having a sleeper seat on a fourteen-hour flight is already costly, those who can afford it can expect to pay 19.4% more for the privilege. Economy class flights to Australia and New Zealand are only predicted to rise by 4.7%.
Some of the biggest price hikes for business class will take place on flights to Africa (11.3%), South America (9%), and Europe (6%).
While rising fuel costs are a major reason for fares increasing more for locations that are farther away from North America, prices are similarly impacted by everything from staff shortages to post-pandemic demand. Those booking in currencies other than USD will also pay more amid a very strong dollar.
"Companies reporting travel cost in dollars may see flat average ticket prices (ATP) on routes out of Europe," the American Express GBT report reads. "[...] The [foreign exchange] effect can be particularly strong in emerging regions such as South America."
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The Many Challenges Facing The Airline Industry And Those Who Fly
2022 has shown that flight prices can vary drastically throughout the year. The airlines are in a constant push-and-pull to navigate rising fuel and staffing costs without raising prices too much and risking alienating flyers.
Certain types of travel, including leisure travel to popular destinations, is doing very well as many swallow the extra costs to take long-awaited trips put off for several years by the pandemic. Business travel, meanwhile, faces a longer road to recovery as many businesses adapted to doing more things online -- according to the Amex report, more small and even mid-range companies are still putting off all but the most necessary employee trips due to high airfare costs.
"Some airlines now expect to end 2022 in profit; as the world continues to reopen they should see an overall return to profitability in 2023," reads the report. "However, aviation will face headwinds as it sets about rebuilding its position and this will create challenges for corporate travel."
