High gas prices and widespread inflation have changed the way many Americans view travel this summer, but a recent study found that the average cost of travel is actually down overall compared to the pandemic and pre-pandemic years.
Travel insurance company Squaremouth.com found that the average cost of travel through early July was about $5,300, up from an average of $5,800 in 2020 and $6,000 in 2019. The data also showed that domestic travel costs more than vacations international for the second consecutive year.
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The study found that the average cost of a domestic trip was roughly $500 more than an international trip, with travelers under 50 spending about $400 more per trip compared to 2019.
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“While there has been some relief on prices, I have noticed some continued reluctance to book due to fuel and airfare prices,” said travel agent John Maddox. “Airfare is the #1 deterrent holding back my all-inclusive resort business. It’s also forcing customers to book shorter cruises. People are not as willing to book even in 2023 because of the uncertainty about the current economic situation.”
Additional data from InsureMyTrip found that travelers are paying less for vacations to some of the most popular destinations, with the average cost of travel for week 1 and week 28 of 2022 in the United States falling from $4,066 to $4,042.
In Mexico, the average cost of travel fell from $3,809 to $3,631, while vacations in the Bahamas fell from $3,754 to $3,284.
While travel costs appear to be heading in the right direction, prices are still higher than last year and before the pandemic. In 2022, the average cost was about $5,051, up from $4,405 in 2021 and $4,767 in 2019.
“I’m very pleased that airline and cruise fares continue to become more affordable,” said cruise specialist Scott Lara.
A report from Mastercard also showed that “runaway inflation” was hurting lower-income customers’ spending habits, including travel purchases. The data showed that cardholders are shifting their priorities from big-ticket items to essentials and groceries.
Mastercard reported its strongest summer travel season since the start of the pandemic, thanks to subdued demand and the easing of coronavirus-related restrictions. Cross-border volumes also jumped 58 percent on a local currency basis in the second quarter, increasing dollar volumes on the company’s network by 14 percent to $2.1 trillion.
“In the United States, what you’re seeing is a downward trend in terms of growth rates on the lower income side of things,” said Mastercard Chief Financial Officer Sachin Mehra.
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