More people than ever before will fly on U.S. airlines this holiday season – nearly 46 million of them – according to a new projection from the industry’s Washington trade group.
If that sounds like a broken record – repeating over and over – there’s a reason for it: it is. In each of the last five years, counting 2018, the industry topped the previous year’s record number of travelers in all of the major holiday travel periods, from Presidents’ Day weekend through the Christmas/New Year’s season.
U.S. carriers are expected to carry close to 1 billion passengers by the time 2018 comes to a close in a couple of weeks. That’s up 3.5% from last year’s total of 965 million total passengers; up 6.8% from 2016’s 932 million; up 10.3% from 2015’s total; and up 14.8% from just four years ago – 2014, when “just” 854 million people flew on U.S. carriers. But more directly; the total annual passenger count for U.S. airlines has risen by almost 150 million passengers in just five years.
This year during the 20-day holiday season that begins Thursday, December 20 and runs through Sunday, January 6, the trade group, Airlines For America, or A4A, projects that 45.7 million people will board commercial flights. That would be a 5.2% jump from the 43.5 million who flew on U.S. carriers during the corresponding travel period last year.
That averages out to an expected 2.54 million passengers per day for each day during the 20-day holiday period. That would be equal to carrying 126,000 more passengers per day, industry-wide, during the holiday travel season this year.
Of course, passenger travel won’t be distributed that evenly across all 20 days. The biggest travel day of the period is forecast to be Friday, December 21, when about 2.9 million people are expected to board U.S. airliners, followed closely by Thursday, December 20, and Wednesday, Dec. 26. The lightest days for passenger travel on U.S. carriers this holiday season (as usual) will be Christmas Eve and Christmas Day plus the last Saturday of the travel period (January 5). But even on those days passenger loads are expected to be relatively high compared with the proverbial “average day” passenger loads.
During last year’s holiday travel period the industry’s load factor – or percentage of filled seats – exceeded 90% much of the time and approached 95% on peak days. To handle the expected increased demand this year during the year-end holiday season, U.S. airlines will be offering about 143,000 additional available seats daily over what they were offering last year.
One obvious reason why travel demand this holiday season is expected to be a record-breaker is the same reason that holiday travel demand has been rising steadily in all recent years: low fare prices.
With less than a month left in 2018 it now is almost certain that the average inflation-adjusted domestic round-trip air fare in America this year will be the lowest it has been in at least nine years. Based on data and analysis from the U.S. Department of Transportation and A4A the average domestic round-trip fare paid during the first half of 2018 was $338, excluding ancillary fees, and $360 including those fees. That’s 15.1% lower than the $398 that travelers paid, on average, in 2014 excluding ancillary fees, and 14.9% lower than the $423 they paid, on average in that same year when fees for ancillary services are included.
John Heimlich, A4A’s Chief Economist, says that “With airfares at historic lows, travelers are choosing to fly on U.S. airlines in record numbers, especially during the busy holiday season. Increased consumer choices and fares that match nearly every budget have enabled a record number of people take to the skies to visit loved ones, conduct business or enjoy a holiday getaway.”
Another huge reason feeding this year’s booming holiday air travel demand is the falling price of fuel. Though oil and refined fuel prices were at times uncomfortably high for Americans during the first nine months of this year, those prices have dropped significantly in the final quarter. That price drop hasn’t had enough time to have a significant lowering effect on airlines’ day-to-day operating costs, or their fares, at least not yet. But lower gasoline prices at the pump have already had an impact on consumers’ pockets, which are a little more full because of the savings each time they’ve filled up since September and because of slightly lower prices paid for products delivered to stores and homes by truck and/or rail.
Meanwhile, Wall Street’s somewhat concerning tumble in recent weeks seems to be having no perceptible effect on U.S. consumers’ desire to fly this holiday season. In part that’s likely because most holiday travel plans were made, and a huge percentage of holiday tickets sold before the stock market turned sharply down over the past few weeks. Additionally, while a number of stocks have lost a lot of value in trading recently, many individual investors likely have not lost that much. Rather many of them simply have moved money out of stocks and into bonds, cash or other investments they believe to be more stable and safe at the moment.
This likely record-breaking year-end holiday season comes on the heels of another record-breaking holiday travel season just a couple of weeks ago during the week of Thanksgiving. Final numbers from that holiday period aren’t yet available. But going in to the 12-day Thanksgiving travel period expectations were that 30.6 million people would board U.S. airlines’ flights, up from 29 million during the same period in 2017.