Travelers walk through Terminal A at Orlando International Airport on Christmas Day, Saturday, December 25, 2021.
Stephen M. Dowell | Orlando Sentinel | Getty Images
U.S. airline bookings slipped 2.3% in May from a month earlier, the second consecutive monthly drop this 12 months, while fares soared over 2019 levels, in response to an Adobe report published Tuesday.
Consumers spent $8.3 billion on domestic tickets last month, up 6.2% from April.
Up to now this 12 months, consumers spent greater than $37 billion for domestic flights, almost double what they spent in the primary five months of last 12 months, when Covid-19 vaccines were just becoming widely available.
“While some consumers have been capable of stomach the upper fares, especially for many who delayed travel plans through the pandemic, the dip in bookings shows that some are rethinking their appetite for getting on a plane,” Vivek Pandya, lead analyst at Adobe Digital Insights, wrote within the report.
Airfare has surged due to high fuel prices, labor shortages and red-hot travel demand after two years of the Covid pandemic, marking one of the dramatic examples of rising inflation this 12 months.
Bookings have been mostly resilient, though it’s unclear whether demand will last beyond the height spring and summer travel season, when airlines make the majority of their annual revenue.
“We now have yet to see any cracks in airline bookings, and investors remain concerned a few potential slowdown post peak summer travel,” Andrew Didora, airline analyst at Bank of America, wrote in a note Monday.
Airlines cheered the Biden administration’s decision last week to lift a Covid-19 testing requirement for inbound international travelers. Didora said the shift could further fuel international bookings.
United Airlines on Monday said that searches for international trips rose 7% within the 72 hours because the White House announced it will scrap the international testing requirements, noting the “majority of searches by U.S. travelers were for near-term travel this summer to destinations in Europe, Mexico and the Caribbean.”