Airline capacity continues to fall as Omicron spreads with 33 million seats now dropped in two weeks to the end of March. The great thing about data is not just the actual numbers but the trends and patterns that emerge; unfortunately, those trends this weekend are probably what we anticipated. England provided their customary two batting collapses inside four days to be “whitewashed” in Australia and global aviation capacity fell again week-on-week.
The first week of 2022 (2-8 January) was somewhat typical for a first week in January. U.S. hotel industry occupancy dipped to 45.4%, which was eight percentage points lower than what it was in the comparable week of 2019 but eight percentage points higher than a year ago. In STR’s 23 years of daily performance measurement, this most recent week’s occupancy was among the lowest for the comparable time period—better than what was seen in 2000 and 2011 but worse than most all of the early 2000s. The highest occupancy for this week was posted in 2018 at 56.8%, with the next highest at in 2007 (54%).
The rise of the Omicron variant coincided with the start of the 2021 holiday travel season, and many worried that the rise in cases would throw a wrench into Americans’ much anticipated travel plans. We dove into the foot traffic data to find out – how did the current COVID wave affect holiday travel? Despite the fourth and fifth COVID waves, location analytics data shows that the hotel industry has been on the path to recovery for quite some time. In July, at the height of the summer travel season, all the hotel chains analyzed showed impressive year-over-two-year (Yo2Y) growth in visits.
Global airline capacity has fallen this week as the impact of travel restrictions begins to be felt across the European market with 3.4 million fewer seats in Western Europe and 720,000 fewer in Eastern Europe. Ryanair did warn us all that this was going to happen, and it has - a 24% reduction in Western Europe and 20% in Eastern Europe. It’s slightly ironic that last week the UK Minister of Transport eased travel testing requirements around the Omicron variant just as capacity was cut, finger on the pulse and UK Government decisions have never been aligned during the pandemic, have they?
The devil really is in the data this week, or to be more precise it is behind the data, but let’s start by looking at how 2021 finished. Global airline capacity ended at 5.7 billion seats compared to the 8.7 billion reported in 2019, so 35% below pre-Covid levels, and of course, demand is much lower for those 5.7 billion seats. Positively, the second half of 2021 saw a stronger recovery than the first half, and global domestic capacity was at 80% of 2019 levels thanks to markets such as China, the United States and Russia.
How did people get anywhere before Google Maps? The GPS app leads all travel apps for most new installs in the year 2021. Below you can see the 10 most downloaded travel mobile apps and OTA (online travel agency) apps across the world and in the US. You can find our full list of 2021 worldwide download leaders here, and compare them with 2020's most downloaded apps. If you need to fully understand what a download is and what is does/does not measure, we have that for you as well.
Seats are not the same as passengers and just because aircraft fly, doesn’t mean they are full. Whilst scheduled capacity gives a current and future view of what is happening – it doesn’t tell you what has happened and how busy those planes actually were. Passenger booking data (how many travelled) and load factors (expressed as a percentage of the seats which had passengers sat in them) do that and provide a benchmark, a view that can be used for future trends and forward-looking indicators across many sectors.
STR’s final 51-chart map of the year shows recent national/regional trends and many states finishing 2021 strong. Further, trend lines for revenue per available room (RevPAR) on a total-room-inventory (TRI) basis provide ample evidence of the hotel industry’s extraordinary rebound, particularly in the second half of the year. Despite expectations for some travel hesitancy related to the spread of the Omicron variant, RevPAR for the four weeks ending with Week 50 (11 December) remained near (or above) 2019 levels for a vast majority of states. Of course, the most recent weekly index comparisons with 2019 are against normal, off-peak months.
In our last global P&L article, we noted that hotel profitability improved across much of the globe as the industry continued its slow recovery. In this latest update with October data, we saw similar trends in P&L data although there were notable outliers in each world region. Among the major European markets, Berlin achieved an October gross operating profit per available room (GOPPAR) of US$95.82, which was 111% of the 2019 comparable. Berlin was the only major market in Europe that was able to surpass its October 2019 GOPPAR level.
In a somewhat typical post-Thanksgiving week (28 November-4 December), U.S. hotel occupancy rose from the previous week to 54.8%. Occupancy indexed to 2019 was 91, which was good but lower than the previous three weeks. However, when compared with 2010, a year like 2021 because of calendar make up and the rebuilding after the Great Recession, occupancy was 10% higher. This week’s average daily rate (ADR) surprised on the downside, falling 0.6% week on week. But with the gain in occupancy, weekly revenue per available room (RevPAR) increased by 3% from the prior week.
As uncertainty and new cases of the Omicron variant increase across the globe, some countries have reimplemented restrictions around travel. New restrictions obviously mean potential challenges for the hotel industry, and as we have seen throughout the pandemic, every class of hotel can be affected differently. In this latest piece, we look at how Luxury class hotels have performed around the globe, especially in more recent months.
With employees continuing to return to offices, ongoing vaccination progress, and the reopening of many international borders, the time would seem to be ripe for the return of business travel. Yet, even before the news of Omicron in recent days, there continued to be negative sentiment about the return of this segment whereas pandemic-era leisure travel sentiment remains buoyant. In November 2021, STR undertook an online survey of its Traveler Panel—an engaged audience of travel consumers—to examine the fortunes of the industry at this uncertain time.
As we get towards the end of 2021 and almost two years since the world has been living with Covid-19, across the aviation industry we’ve continued to talk about recovery in terms of air travel returning to pre-pandemic levels. Specifically, we tend to reference 2019, the last full year of air travel unaffected by this virus. With air travel growing year-on-year until then, 2019 is the high watermark in air travel, the year when global airline capacity and passenger numbers peaked.
The days before and after Thanksgiving are some of the busiest travel days of the year – so we took the opportunity to check back in and give an update on the travel and hospitality recovery as 2021 draws to a close. From April to July, the year-over-two-year (Yo2Y) monthly visit gap had been slowly but surely shrinking. But when we last checked in with the travel sector in late August, the summer season seemed to have ended abruptly, as the United States entered its fourth COVID wave.
Despite the best attempts of the latest Covid-19 variant 'Omicron', and a series of unilateral knee-jerk reactions from Governments around the world, global capacity this week remains stable. Rates are steady at 78.3 million, half of one percentage point down and the whole airline industry continues to watch events very closely, marvelling at the next crazy restriction that encourages travellers to find cunning ways to avoid taking a test. So far, fingers crossed at least, the airlines have not panicked.
Thanksgiving week for the U.S. hotel industry was record-breaking by all measures. Weekly occupancy topped 53%, which was 2.3 percentage points higher than the holiday week in 2019 and nearly a point higher than the previous record achieved in 2018. Thanksgiving Day occupancy (56.9%) fell a bit short to 2018’s level (57.3%) as did Monday’s, but occupancy on the other days of the week were at record highs. Looking at the 3-day weekend (Thursday to Saturday), occupancy reached 60.2%, 0.9 percentage points greater than in 2018 and 2017 which had been the bar to surpass.
Covid-19 has stretched the creativity of every airline network planner in the last twenty months as they changed airline schedules on a weekly or even daily basis in response to various lockdowns and changes in policy. At OAG we have seen exponential increases in schedule updates arriving from airlines around the world, and although it proves the creativity and resilience of an industry caught in a crisis, we all want to see stability return to airline schedules.
As COVID-19 cases rise in many parts of the world, especially Europe, the travel industry may be set for another period of disruption as winter encroaches and traveler sentiment worsens. Uncertainty in recent days has mounted further as the new Omicron variant has spread quickly, leading to many countries reimposing COVID restrictions. The situation is particularly ambiguous as recent months had produced stronger levels of hotel performance with vaccination progress leading to buoyed demand, reduced restrictions and the reopening of many international borders.
A new report from ForwardKeys reveals which destinations were the most visited since 1st November by travellers from the eight southern African countries currently designated as most at risk due to the Omicron variant of COVID-19 – namely Botswana, Eswatini, Lesotho, Malawi, Mozambique, Namibia, South Africa and Zimbabwe. The data supports calls from many people objecting to immediate travel restrictions imposed on travel to and from these African countries.
In partnership with European Cities Marketing and their Barometer Report, the analysts at ForwardKeys shone the high beam on the highs and lows of travel within Europe this summer and in the last quarter of a roller-coaster year. And a few nuggets were unearthed, showing the return of business and luxury travel back to Europe. There is increased demand for luxury travel. To illustrate this, we looked at passenger arrivals from Los Angeles to London and we see an increase in the share of passengers travelling in Business, First and Premium Economy classes.
