The US travel industry has been hit hard by the pandemic and digital travel sales may drop 45% this year, with many sectors not recovering until 2022.
| US digital travel sales will fall 45% this year, down more than $93 billion This story was delivered to Insider Intelligence eMarketer Briefing subscribers this week. The travel industry is one of the hardest hit by the coronavirus pandemic and our new forecasts show that US digital travel sales will fall nearly 45% this year to $115.27 billion, which is about $93 billion less than last year's total. We expect that many sectors will not recover until at least 2022, and consumers' canceled and delayed trips means that advertisers will do the same with their campaigns. The US travel industry's recovery will depend largely on the development of a coronavirus vaccine. Travel in the US will pick up again as lockdown restrictions ease in H2 2020, but demand will likely remain weak until a vaccine becomes available, which by many estimates is not likely to arrive until H2 2021. Under these assumptions, travel will surge in 2022, and US digital travel sales will grow nearly 50%, returning to pre-pandemic sales numbers. Until then, most US adults plan to avoid leisure travel, especially internationally: According to an April 2020 survey conducted by The Harris Poll, 68% of US adults plan to avoid nonessential travel even after the coronavirus pandemic ends, and 59% of respondents will opt to travel by car to avoid air travel.
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These sectors within the industry have been hardest hit: Airlines: United Airlines, American Airlines, Southwest Airlines, and Delta Air Lines reported approximately 20% drops in passenger revenues in Q1 2020 vs. Q1 2019. As of late May, Transportation Security Administration data showed foot traffic at airports was beginning to rebound but was still down 88% year over year. Hotels: The American Hotels and Lodging Association has claimed that the hotel industry is "on the brink of collapse." In March, the CEO of Marriott International, the largest hotel chain worldwide, said business was down 75% below normal levels in most markets. Cruise Lines: The Centers for Disease Control issued a No Sail order in March, which is currently in effect until July 24. As a result, the three major cruise companies—Carnival Corporation & plc, Royal Caribbean International and Norwegian Cruise Line—reported severe Q1 losses. To join our free Chart of The Day Newsletter and get data-rich charts to your inbox each day, click here. |
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