ForwardKeys: Bright outlook for global long-haul travel everywhere but USA
This year, everyone wants to be anywhere but in the USA. Or at least that’s what ForwardKeys, a Spain-based intelligence consultancy specialising in intercontinental travel bookings, forecasts in its latest report.
David Tarsh, a spokesperson for ForwardKeys, said that its prediction is based on analysing at least 17 million flight booking transactions for future travel in a day. Given that ‘future’ in this case means Q1 2018, it looks like these months are going to be exciting for travellers and airlines all over the world, with long-haul flight bookings at 10% ahead of the same time period in 2017.
So who are the biggest winners in 2018?
Definitely Asia and Australasia, where inbound bookings are up 12% from Q1 2017. Economic growth in Australia, New Zealand, India and China has increased demand for travel, with the Chinese being particularly aggressive to go as far as Canada, another big winner.
Africa and the Middle East as well, where inbound bookings are up 11.9% from the same time period last year. For Africa in particular, this rise also applies to outbound travel. General economic recovery in Nigeria and South Africa, as well as the re-opening of Egypt to Russian tourists, have all helped make this possible.
Continental Europe is another victor, where inbound bookings are 13.3% ahead of the same quarter in 2017. Russia leads the way, kicking both international and local tourism by virtue of hosting the FIFA World Cup.
In the Americas, we are seeing extremes with overall bookings at 4.8% ahead of the same quarter last year – besides Canada, countries in Latin America are also expected to do well this year. Favourable bookings from Mexico and continuous double-digit growth in Argentina, Brazil and Chile are the biggest reasons for both regional and long-haul outbound travel from this side of the world. In particular, Argentina is currently seeing a whopping 22.9% increase in long-haul departures.
Who are the biggest losers in 2018?
In Asia, it’s South Korea. The poor country is still reeling from the wintery conditions of the THAAD missile crisis, to the point that neither a recent thaw in diplomatic relations nor holding the Winter Olympics in Pyeongchang on Chinese New Year can cause long-haul bookings to rebound like they normally would in other years.
The UK is also expected to grow less well, with the rise in the value of the £ Sterling translating into dampened enthusiasm for travellers to enter the kingdom.
But the worst of the lot is definitely the USA, where bookings for international arrivals are just a measly 2.6% ahead – lower than average for the entire American continent.
Always take forecasts with a grain of salt
Of course, all this optimism comes with some caveats. First, Tarsh disclosed that the benchmark for the above estimates is Q1 2017. Looking back on the year that was, Asia Pacific enjoyed a rise in intercontinental air travel at 4.4% ahead of Q1 2016. Africa and the Middle East also experienced an 11.5% increase in inbound flight arrivals from the same time frame in the previous year. Europe had the highest lift at 13.3%, helping make up for the standstill experienced in the Americas at 0.1% up on 2016.
The second caveat shared by Tarsh is that ‘all data shared by ForwardKeys are in terms of future travel, comparing the current situation to the equivalent time frame a year before.’ And given that the benchmark is 2017:
Last year (2017) was outstanding for long-haul travel, with global growth at upwards of 7.0% considering the economic and political uncertainty throughout its 12 months. This makes the prior year (2016) pale in comparison and is understandably a tough act for 2018 to follow.
Third: travel is generally expected to grow at 4% per annum, and volatility is expected in the long-haul figures more than they are for closer inbound or outbound trips. Other circumstances outside of ForwardKeys’ predictive science may affect bookings, or the lack thereof, closer to the date of travel being analysed. At the time this report was being compiled, the political situation of Argentina was not yet determined to have any effect towards inbound or outbound travel from the country. With very big events like the Olympics, travellers generally book early, but price jacking and other factors mean we won’t necessarily see more people flying in. Tarsh explained, ‘If people have booked early, it can make that period look fantastic, but there is no way to fully predict whether or not more bookings materialise closer to the date of travel.’
That said, the big picture shows a positive outlook for intercontinental flights in early 2018. Stay tuned as we check back with ForwardKeys midway through the year to see which predictions have taken hold and which have gone so far out of range.