U.S. travel industries assume that between the period of Oct 2023 – Dec 2023 the travel demand would strike the downward trend due to impact of inflation on consumer budget and recession panic situations. According to the U.S. Travel Association in December 2022, their spending has hiked up by 7% above the 2021 levels and 3% above the 2019 levels with a sum total of $97 billion.
The M.D. of Truist Securities, Mr Patrick Scholes said in an interview, “Investors are increasingly becoming more comfortable that we are not going to see a travel pullback in the first half of the year, but the back half of the year remains to be seen.” Patrick added that, the Group bookings are still down by 15% in comparison to the pre-Covid conditions. According to him, recession in other industries will continue to affect the Travel business
The top companies from the Travel and Airlines industries namely: Hilton Worldwide Holdings, Booking Holdings, Southwest Airlines, Marriott International, Delta Air Lines, Royal Caribbean Cruises are witnessing hike in rates of booking in 2023 as compared pre-Covid period. Also, in December there is a 33% growth for short term rental booking says AirDNA. There was a 50% increase in the 4th Quarter in consumer travel business compared to the pre-covid period. Booking Holding CEO, Mr. Glenn Fogel says, January 2023 set a new record for monthly room night bookings.
Hilton CEO, Mr. Christopher Nassetta forecasted that demand will plateau as the economy slows in the second half of 2023.
U.S.travel companies have a lot of exposure with China which is considered as largest outbound travel market in the world. In context with the same, Marriott international CEO, Mr. Anthony Capuano said, “We believe there’s still further upside in 2023, especially now that China’s borders have reopened”.
As per the U.S. stock market index of Standard and Poor’s 500 sunk by 4.9% and that of travel stocks including the airlines like Booking Holdings, Southwest Airlines, Marriott International, Delta Air Lines etc have also gone down by an average of 15.7% in the previous years .
Even though US Travel Industry is seeing an upward trend, the companies like Home Depot selling latest home interior products along with some other non-mandatory products have crashed down. Home Depot CEO, Mr. Edward Decker says, “You can’t fight the tide (with consumer spending) going back to services, people traveling and whatnot.”
