Good morning from Skift. It’s Frida, June 24 in New York City. Here’s what you need to know about the business of travel today.
Today’s edition of Skift’s daily podcast looks at the spike in one-way airfare sales, the impact of North American tourists in southeast Asia, and why corporate travel leaders aren’t closing deals with hotels.
The pent-up demand for travel this summer has resulted in travelers rapidly snapping up plane tickets, with a growing number of them buying one-way tickets due to surging airfares and reduced flight schedules, writes Editorial Assistant Rashaad Jorden.
Tracey McGoughy, an advisor at travel agency Carib Comp Travel and Wellness, said travelers are more interested in purchasing one-way tickets since round-trip flights aren’t as cost-effective as they were pre-Covid. Roughly half of her clients’ itineraries currently involve one-way flights — a major contrast to prior to the pandemic, when practically all of her customers took round-trip flights on the same airline.
McGoughy said that airlines curtailing their schedules have made certain round-trip flight combinations more difficult to sell, adding some of them don’t make sense for her clients.
We turn next to Southeast Asia. As travelers from China and Japan — the region’s traditional major source markets — still haven’t returned in large numbers, it’s visitors from the U.S. who are leading Southeast Asia’s tourism recovery, reports Asia Editor Peden Doma Bhutia.
U.S. inbound traffic to Southeast Asia is approaching 75 percent of 2019 levels, according to market intelligence firm ForwardKeys. That’s the strongest rebound among the region’s long-haul markets with inbound traffic from second place Australia hitting 60 percent of pre-Covid figures.
And with the U.S. government dropping pre-departure Covid test requirements for inbound air travelers earlier this month, Southeast Asia could welcome even more American visitors, which would boost its recovery. U.S. travelers to Southeast Asia are, on average, staying longer than they did prior to the pandemic.
Finally, corporate travel buyers normally are eager to lock in hotel rates for the next year, but inflation is prompting them to delay negotiations with hotels, reports Corporate Travel Editor Matthew Parsons.
A straw poll of 150 travel buyers earlier this week during a webinar run by auditing and rebooking platform Tripbam revealed that many were pushing back their hotel sourcing programs in large part due to surging room rates. While Parsons writes travel buyers typically issue requests to hotels in late summer for proposals to lock in rates for the following year, Tripbam CEO Steve Reynolds urged buyers to wait until the fourth quarter of this year to start negotiating with hotels. He believes buyers would see more favorable market conditions then despite acknowledging they wouldn’t have a lot of time to strike deals.
Most corporate travel buyers, Parsons noted, have benefited from hotel chains rolling over discounts from Omicron-stricken 2021 to this year.