Can the post-pandemic travel boom endure?

Tourists are swallowing higher prices but ever tighter household budgets pose risks for hotels and airlines

“Many hoteliers have been able to mitigate some of the cost pressure be it labour costs, food costs, general inflationary pressure, by driving up the average room rate,” said Andreas Scriven, partner and head of hospitality and leisure at Deloitte. “But how long can that go on for? Everybody is asking themselves the same question.”

Key takeaways

• Many within the travel and tourism industry, which accounted for 9.6 per cent of gross domestic product in the EU in 2019 according to the World Travel & Tourism Council, believe the post-pandemic travel boom may well persist.
• But others are more sceptical that the uptick can be maintained as would-be holidaymakers’ budgets come under pressure from tightening economic conditions;
• According to Deloitte there is a real risk around people’s spending power going forward, as you’ve got obviously less disposable income if you’re exposed to variable-rate mortgage reset, and your dining out costs have already gone up.

Get the full story at the Financial Times