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Finally – is this the rebound that will spark a turnaround?

July 2, 2020 Headline News No Comments Email Email

Many trends start in America and new evidence of a rebound in domestic aviation in the US may bring hope to many travel and tourism workers in Australia and round the world.

The news is particularly interesting because the rampage of the Covid-19 coronavirus pandemic is far more advanced and severe in the US than in many other parts of the world.

Despite that, ForwardKeys, the travel analytics company, has revealed that a rebound is underway in domestic aviation in the US and the high spot is the upcoming long weekend to mark American Independence Day. Independence Day itself falls on 4 July.

An analysis of new flight tickets issued between the start of the year and mid-June shows that the bottom of the market was during the first week of April. From then, there has been a steady climb, reaching 42% of 2019 levels during the third week of June.

Closer analysis, by type of tickets issued, shows that the recovery is being driven much more strongly by leisure bookings, which have substantially outpaced business bookings since the collapse in the market in early March.

Olivier Ponti, vice president, insights, ForwardKeys

As of 23 June 2020, the number of new US domestic air tickets issued for travel between 20 June and 18 July, a fortnight before and a fortnight after the Independence Day holiday, were 55.8% behind the equivalent period last year. However, bookings for the start of the Independence Day weekend were just 16.9% behind the same day in 2019.

A likely reason why this year’s Independence Day travel bookings are relatively less badly affected is that July 4 falls on a Saturday in 2020. Consequently, a public holiday is created on Friday July 3 and, with it, the opportunity for a long weekend break without having to take time off work, whereas it fell on a Thursday last year.

Economists are expected to pay careful attention to signs of recovery in the aviation sector, because domestic tourism represented 4.5% of the US economy in 2019 – a trillion-dollar industry, according to the World Travel & Tourism Council.

Olivier Ponti, vice president, insights, at ForwardKeys, welcomed the trend, with certain reservations.

He said: “It’s inspiring to observe that a rebound is underway; and that Independence Day is the high-water mark. However, a major unknown is how the Covid-19 outbreak will progress and how significantly the latest spikes could arrest the recovery in flight bookings.”

Edited by Peter Needham

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