After a solid end to 2024 and beginning of 2025, travel
demand in certain sectors in February started to show signs of fraying.
Domestic air passenger demand, as measured in revenue
passenger kilometers, declined 1.9 percent year over year, according to the
International Air Passenger Association, with notable domestic declines in the
United States (4.2 percent) and China (3.2 percent). International travel
demand on North American carriers dipped too, down 1.5 percent. And while IATA
noted some factors that boosted February 2024 from a demand-comparison
level—the month had an extra day in leap year 2024, and Lunar New Year was in
February last year but January this year—director general Willie Walsh still
noted that "we need to keep a close eye on developments in North America."
Outside of North America, international travel remained
robust in February, with demand and capacity, as measured in available seat
kilometers, increasing on carriers from all other global regions.
For the third month out of four, the number of air tickets
sold by U.S. corporate agencies and settled by ARC declined year over year,
which ARC suggested reflected “overall market volatility," ARC chief
commercial officer Steve Solomon said in a statement. "Macroeconomic
trends are creating a more dynamic environment for consumers, businesses and
airlines in the short term. Even with fewer passengers traveling compared to
January, our year-over-year data for both domestic and international trips
remains steady." The overall average U.S. domestic ticket price in
February increased a few dollars from the month before, as did the average
price for a premium-class ticket.
U.S. hotel demand in February remained strong, according to
hotel analytics firm STR, with occupancy, average daily rate and revenue per
available room each increasing year over year for the fifth straight month. The
effects of the Los Angeles wildfires and continued recovery from last year's
hurricanes in the Southeast again boosted occupancy data, but STR suggested the
effects of that factor have started to recede.