What to expect from Memorial Day and summer travel
Julian Ing, Launchtrip CEO, joined Yahoo Finance Live to discuss his outlook for the travel industry and what he's expecting from Memorial Day Weekend.
Video Transcript
ADAM SHAPIRO: I'll date myself with this reference, but it was the Go-Gos who sang, "Vacation, All I Ever Wanted," right? Millions of us will be cheering that, especially with the start of the summer travel season. Let's talk about where it's all headed. Julian Ing is Launchtrip's CEO. And I don't think it's a secret millions of people are going to hit the roads, fly, whatever. But what trends do you see for the entire summer travel season? Will we take one vacation or several?
JULIAN ING: No, statistically, it's usually about one vacation a year. But due to the pent-up demand for travel over the last year and a half, we're looking at an average of 2, 2.5 trips this year. And I think according to American Express, too, 71% of people will be traveling domestically in the US this coming year.
SEANA SMITH: Julian, when you look at where people are going, starting this weekend, we're expected to see this massive surge. People can't wait to get out of their homes and go somewhere. Where are people headed?
JULIAN ING: Well, you know what's really funny is, I think with the reopening of a lot of the states, especially your main primary states, like when you're looking at LA, you look at Miami, you look at New York City, you have Orlando, I think a lot of the southern and the more warm states is where a lot of people are heading. And I think one of the biggest trends that I see right now, what we see in the travel industry is that connectivity that people want again. So family trips, reunions, weddings that were put off for all-- for the last year and a half. I think it's just-- it's more than just taking a vacation right now. And I think with the reopening of the United States, I think you'll see a lot of travel trends go that direction.
ADAM SHAPIRO: I was a bit aghast at some of the prices for airplane tickets. We were looking at going to a wedding in October. I mean, that's still far out. And the price to get there is outrageous. What are you seeing with airfares?
JULIAN ING: Adam, I think that's even going to go-- it's going to go a lot higher. I think one of the things that we have to look at is, is, how much more complex air travel is going to get, right? With heightened security, with heightened safety issues, all that cost is going to be passed on to the consumer. So you should expect prices for travel to go up a lot this year and expect it to go up even more next year for sure.
SEANA SMITH: Julian, what about rental car prices? Because they have soared. I've talked to some friends who have rented a car just for a day or two, and the amount that they're paying is something that, I mean, it's eye popping numbers. Is this something that you think is also going to continue to rise? And I guess, at what point will we start to see a little bit of a pullback in these high prices?
JULIAN ING: To be honest, pulling back on those prices is really going to be hard to track right now. I think we'll see and observe a little bit more of that over the next couple of years, next 24 months. But I can tell you right now that car rentals have outpaced lodging and airlines in the last two months. And I think really, again, it has to do with the trend of domestic travel. A lot of countries out there still haven't been fully unlocked. You know, like, Germany is not allowing anyone from the UK to travel in. But within the US and at the speed of everyone unlocking, domestic travel is going to be really big. And part of domestic travel is ground transportation. And car rentals is the hot ticket right now.
ADAM SHAPIRO: If you can get a rental car. I know, like, for instance, Miami International Airport, you can fly in there now. They'll give you-- they'll actually give you a free vaccine. But good luck getting a rental car. Just want to ask you, how much do you see among people buying airplane tickets, as we went through this, the cattle car seat was really cheap, but we had a few extra bucks so maybe we'll do, well, why do economy when, just for a few extra bucks, you can do the extra leg space? Do people price themselves higher now, given the fact that we haven't gone anywhere for over a year?
JULIAN ING: Hands down, and I think everybody's going to be doing a lot of upgrading not just on rental cars, but for lodging, for airline tickets. You got to think in the last year and a half, no one's really gone anywhere. And they've done nothing but save money. And I think they've been saving up for revenge travel, which is something that we believe in the travel industry is very real. And I think everyone's waiting to take their first trip or first couple of trips. And they want it to be a little bit more relaxed than they usually do have-- what they usually spend money on. And I think that's going to be a big ticking trend moving forward for sure.
ADAM SHAPIRO: When our team writes this up, the headline should be, "Revenge Travel, Here It Comes." Julian, thank you so much for joining us. All the best to you and your team.
