Mt. Fuji, Japan.
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Americans are poised to travel overseas in a big way in 2023.
Households are continuing to unleash two or three years’ worth of pent-up demand as Covid-19 fears wane and the last vestiges of pandemic-era border restrictions have eased.
The U.S. dollar also remains relatively strong versus currencies like the euro, hybrid work yields more flexibility for big trips and some airlines have added new long-haul routes to overseas destinations, according to travel experts.
“The travel industry is just going gangbusters,” said Erin Florio, executive editor of Condé Nast Traveler.
Why travel abroad is poised ‘for a big comeback’
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Thirty-one percent of Americans are more interested in international than domestic travel, according to a recent poll by tourism market research firm Destination Analysts. That was a six-point increase from February and a year-to-date high, according to the survey, published in November.
Meanwhile, 62% of 2023 flight searches in the first week of December were for international destinations, up from 55% the same time last year, according to a recent Hopper report. It cited international travel among the top three trends for 2023, saying it’s poised “for a big comeback.”
Searches on Kayak for flights abroad are up 1.3% versus a year ago, according to company data as of Dec. 18. Those for domestic flights were down 13%.
In 2022, the share of international trips for which Americans bought travel insurance was on par with 2019 levels, the first time that had occurred in the pandemic era, according to data from online travel insurance marketplace Squaremouth. The trend has continued for trips booked for 2023.
American travelers largely stayed within U.S. borders in 2020 and 2021 amid health concerns and overseas Covid-related restrictions such as testing requirements, mandatory quarantines or outright bans on foreign tourists. Visits to U.S. national parks boomed and RV rentals soared as outdoor vacations offered the dual benefits of travel and relative virus safety.
Now, fear of the virus has waned. In September, the share of travelers unconcerned about contracting Covid surpassed those who are concerned, the first time that had happened in the pandemic era, according to Destination Analysts.
‘There’s a lot of pent-up travel demand’
Tower Bridge, London.
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2022 was also a year for more big trips abroad — but a spike in virus cases toward the end of 2021 and into the new year, fueled by the highly contagious omicron variant, somewhat dampened enthusiasm, experts said.
“There’s a lot of pent-up travel demand,” said Jessica Griscavage, a travel advisor and CEO of Runway Travel. “We missed travel for two to three years.”
This so-called “revenge travel” trend — a term recently coined to describe burgeoning, pent-up wanderlust — coincides with looser health rules abroad and at home.
The U.S. dropped a Covid testing requirement for inbound air travelers from abroad in June. That rule, which also applied to U.S. citizens, mandated a negative test within a day of flying.
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Many countries had also fully closed their borders to foreign tourists. Now, most are again welcoming visitors — especially those with a Covid vaccine.
Fully vaccinated tourists can access 197 countries without Covid-19 testing or quarantine, and an additional 16 are open but require testing, according to Kayak data.
“We’re pretty much at a place where we can go anywhere,” Florio said.
Just 12 countries, including China, Libya, Turkmenistan and Yemen, are still closed to vaccinated Americans, according to Kayak.
Many countries have more restrictions in place for the unvaccinated. About 69% of Americans are fully vaccinated, according to the Centers for Disease Control and Prevention. The CDC recommends being up to date on vaccines before international travel.
Many nations — including Australia, Bhutan, Israel, Japan, Malaysia, Morocco, New Zealand, the Philippines and Singapore — eased border closures in 2022. Many European nations also dropped testing requirements for Americans. (Travelers should consult the U.S. State Department website for country-specific Covid restrictions.)
In addition, the pandemic-era surge in remote work has made “bucket-list trips more of an achievable reality,” said Nitya Chambers, executive editor and senior vice president of content at Lonely Planet.
Indeed, Hopper found 67% of travelers take trips more often and 20% travel farther away due to the flexibility of remote work.
Where travel is ramping up most
Ho Chi Minh City, Vietnam.
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The Asia-Pacific region is poised for the biggest bounce in 2023 due to its broad reopening in the second half of 2022, travel experts said.
Japan has seen perhaps the biggest boost in interest, they said. The country re-opened its borders to travelers Oct. 11, with some remaining restrictions.
“You almost can’t talk about travel without the country of Japan being referenced for 2023,” Florio said, adding that Australia and New Zealand are also “massive.”
Asia has surged in demand the most of all regions, according to Hopper data, which shows 27% of international flight searches are to Asian cities versus 19% last year.
Indeed, eight of the top 10 trending international flight destinations in early December were within Asia and Oceania, Hopper said. Tokyo; Ho Chi Minh City, Vietnam; and Bangkok were the top three, with airfare averaging around $1,200 per round trip ticket.
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G Adventures, an international tour operator, has seen 2023 sales swell most for Japan, Thailand and Vietnam, said managing director Ben Perlo. This November was a record overall month for the company; sales for the three Asian nations each surpassed their November 2019 numbers, he said.
However, Europe has remained the most popular destination in terms of total volume, with European cities capturing a third of all international flight searches, about the same as 2021, Hopper said.
Long-term rentals (those 28 days or longer) have “become substantially more popular in Asia-Pacific compared to a year ago,” according to an AirBnb spokesperson. Most long-term stays are in Europe and North America, though.
Major European hubs were among the top searched this year through Sept. 30, according to Google Flights data. London ranked No. 1, followed by Paris (No. 3), Rome (No. 6) and Lisbon (No. 9). Ho Chi Minh City was No. 2, while other Asian cities like Delhi and Mumbai also ranked highly (No. 4 and 7, respectively).
Italy, the U.K. and France ranked a respective first, third and fifth among top foreign destinations in 2023, according to a recent Destination Analysts poll. (Canada, Mexico and Japan ranked second, fourth and sixth, respectively.)
“Everybody wants to go to Europe,” said Griscavage. “It was a destination everyone missed through the pandemic.”
Due to the demand, people have gotten more “creative” on how to travel to Europe, she added. Many are opting for the typically less busy (and less costly) shoulder season, perhaps as early as March or in the late fall, Griscavage said.
Global demand for travel has played out similarly, with most interest directed at Europe and Asia, according to Expedia data. Edinburgh, Scotland, and Sydney, Australia, rank No. 1 and 6 partly due to respective major events like the Fringe, the world’s largest arts and media festival, and WorldPride, Expedia said.
Economic concerns, inflation ‘aren’t stopping people’
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This isn’t all to say travel is without headwinds, though. Value has been of particular concern for travelers, whose budgets have been stressed by high inflation. Overall prices for airline fares and hotels are up 36% and 3%, respectively, in the past year, according to the consumer price index.
International trips are poised to be more expensive next year, Hopper said, despite signals from the consumer price index that airfare, hotel and rental car prices have been trending downward in recent months. The desire to travel abroad has swelled through 2022 despite these economic anxieties, said Destination Analysts.
The euro has been trading at historically weak levels against the U.S. dollar, meaning Americans have been able to get bargains when booking travel to countries like France, Germany, Italy and Portugal. That dynamic is likely driving at least part of the popularity, Perlo said. (The euro has strengthened a bit in recent weeks, though.)
“The economy right now and prices aren’t stopping people from traveling,” Chambers said. “People have been home, they want to get back out there, they have a list of things they want to experience and they’re doing that.”