Good morning from Skift. It's Friday, April 14, in New York City. Here's what you need to know about the business of travel today.
Skift Daily Briefing Podcast
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Today’s edition of Skift’s daily podcast explains why Americans are optimistic about travel, why tour operators are thinking about solo travelers, and how President Joe Biden is trying to reduce airline emissions.
Despite widespread concerns about the state of the economy, Americans traveled in large numbers in March and many expect to travel more in the next year, writes Vice President of Skift Research Haixia Wang in Skift Research’s latest report.
Skift Research has released its U.S. Travel Tracker: March 2022 Highlights, which revealed that roughly 41 percent of Americans traveled last month. Although the figure is a very small increase from January’s mark, it’s 5 percentage points higher than March last year, which Wang writes is a positive sign for the travel industry ahead of the busy summer season.
Although 51 percent of American adults in Skift Research’s survey believe the U.S. economy will fare worse in the next 12 months, economic concerns aren’t expected to slow down the pent-up demand for travel. Roughly 34 percent of respondents still expect to increase their travel spending in the next year, which is more than double those expecting to do the opposite.
Next, tour operators have long welcomed solo travelers on their trips, but they’ve sometimes struggled to attract large numbers of guests from the lucrative market. But such companies are making inroads with solo travelers by increasingly launching new deals geared toward the growing segment, reports Editorial Assistant Rashaad Jorden.
As tour operator executives believe consumers are willing to splurge a little more for their own room if it’s affordable, one step they’re taking to reduce single supplements, which are fees charged to solo travelers who occupy a hotel room by themselves. The Travel Corporation, the parent company of dozens of tour operators, cut down its single supplement on average between 45 and 55 percent this January for all its brands except Contiki.
But Explore Worldwide went even further with a sale in February that offered consumers free single supplements on hundreds of departures and half off on most others. The company estimates that travelers who made booking trips during the sales were able to save up to $850.
Finally, President Joe Biden expressed support earlier this week for a Sustainable Aviation Fuel, or SAF, tax credit that would serve as an incentive for the airline industry to cut emissions. However, Airlines Reporter Edward Russell writes it’s uncertain if it will ever become law.
SAF is considered the quickest and most effective solution in the near term to significantly decrease the use of fossil fuels. Global SAF production is on track to reach 1 billion gallons annually by the second half of this decade, but that figure would only represent 1 percent of aviation fuel use worldwide.
Savanthi Syth, an aviation analyst at investment bank Raymond James, believes a federal tax credit or other incentives could boost SAF production beyond the 1 billion gallons forecast. But legislation that would provide an up to $2 per gallon tax credit for sustainable fuels is currently stalled in Congress despite bipartisan support.