How will inflation influence 2022 travel plans? After two years of pandemic-limited travel, experts forecast revenge travel will elbow past inflation in 2022.
“Our latest data shows the pent-up demand for travel is overshadowing the current inflated prices of travel,” said Tori Emerson Barnes, the U.S. Travel Association’s executive vice president.
Trip-takers are also more likely to spend more money and time on travel this year.
“Now more than ever, people want to travel. Many travellers expect to spend extra time or more money – or both – on upcoming vacations to compensate for the two-year pandemic-induced travel moratorium,” said Dan Richards, CEO of Global Rescue and a member of the U.S. Travel and Tourism Advisory Board at the U.S. Department of Commerce.
How are people managing travel with inflation squeezing household budgets? Experts share their tips to help lower travel costs and get the most out of your budget.
Airfare
According to finance company NerdWallet, airfares this year are still lower than pre-pandemic prices. But ticket prices are likely to climb later in the year, according to travel expert Peter Vlitas. “There will be a significant price increase in 2022.” Prices may creep up as airline industry staffing shortages get tighter. Thousands of pilots retired at the start of the pandemic, and now there aren’t enough as travel rebounds.
Travel Tip: Book six weeks in advance for domestic flights and four months in advance for international flights. Flights are typically less expensive on a Tuesday or Wednesday.
Lodging
The price for lodging away from home, including hotels and motels, saw one of the biggest swings of any travel category: a low in December 2020 matching 2013 prices to an all-time high in July 2021. Seasonality is a big player in hotel prices, so expect higher rates — combined with fewer amenities —this summer.
Travel tip: Be flexible. Schedule a vacation after the summer season, for example, the less-travelled months of September and October when lodging rates are cheaper.
Car Rentals
Car rental rates are up 24% from February 2021 and up 38.6% since February 2020. Combining summer travel demand with rising gas prices, NerdWallet suggests skipping the rental car this year.
Travel tip: Choose accommodations within walking distance of the landmarks and landscapes you wish to visit.
Dining
Eating out costs more. “Full-service restaurants are charging about 6% more. These increases come as operators navigate a confluence of cost pressures, from gas to commodities to labor, in an inflationary environment not seen in about 40 years,” according to a Forbes report.
Travel Tip: Look into hotels with kitchenettes or consider renting a house or cabin with a kitchen, microwave and fridge. Plan to make a few meals to spend less money eating out.
CFAR Insurance and Travel Protection Memberships
To protect against financial loss, travellers are buying more Cancel For Any Reason travel insurance. “Sales of travel insurance plans with trip cancellation coverage increased 255% year-over-year,” according to a Forbes report.
But the pandemic and the war in Ukraine also raised awareness among travellers of the importance of obtaining emergency evacuation travel protection that includes rescue from the point of injury, illness, COVID-19, civil unrest and natural disaster. Traveller requests for non-medical security evacuation services jumped 31% since the Russian invasion of Ukraine.
“Uncertainty in travel generally increases traveller demand for emergency medical and security services. Between the war and the pandemic, travellers want medical and emergency response services more than ever. Given the volatility in the world right now, travellers need to be prepared to leave wherever they are quick,” Richards said.
Written By: Marietta Formanek
Marietta Formanek is the Chief Financial Officer at Global Rescue, the leading provider of medical, security, evacuation and travel risk management services. Formanek held senior finance positions with outdoor recreation company, Orvis, and was the Chief Financial Officer of the software firm, AI Squared.
.jpg){kind=tracking}
