The Post-Pandemic Travel Boom Is Beginning Its Descent

Descending Demand

The “revenge travel” craze that followed the pandemic may be coming to an end, as budget airlines slash prices to attract travelers.

This slowdown in travel spending comes as American consumers are grappling with high prices and everything from groceries to hotel rooms.

(Some) Cheaper Flights

Prices for domestic flights have fallen by more than a quarter since the start of summer, according to data from travel app Hopper. The spending slowdown has been most dramatic for budget airlines like Spirit Airlines (SAVE) and JetBlue (JBLU), which rely on selling tickets for domestic travel.

On the flip side, major airlines such as United (UAL) and Delta (DAL) have not experienced the same slowdown in demand. Spending on premium seats and international flights has remained particularly strong.

Falling demand for airline tickets has spooked investors and hurt the stock prices of many airlines. An ETF that tracks the airline industry (JETS) — has fallen 25% since July.

While that might be bad news for airline companies and their investors, it may be good news for American travelers. The oversupply of airline seats and consequent deals could make it the perfect time to book your next domestic flight — as long as you don’t mind flying with a budget airline.

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