This week IATA, the International Air Transport Association, released its 2025 outlook, covering everything from the number of people expected to fly, to financial outlooks for the industry and the progress (or not…) on the industry’s goal of producing enough sustainable aviation fuel (SAF) to help airlines combat climate change.
Here are some highlights:
5.2 billion people are expected to take to the skies during 2025. That’s a 6.7% increase over 2024 and the first time the total expected passengers will exceed the 5 billion mark.
IATA expects the average airfare in 2025 to be $380, which is 1.8% lower than 2024.
In 2025, global airline industry revenues will exceed $1 trillion for the first time, representing almost 1% of the global economy. Airlines also have $940 billion in costs and retain a net profit margin of just 3.6%, said Willie Walsh, IATA’s Director General, “Put another way, the buffer between profit and loss, even in the good year that we are expecting of 2025, is just $7 per passenger.”
Airlines face some significant risks
IATA notes that there are strong geopolitical and economic uncertainties facing the airline industry, including multiple conflicts around the world and the incoming Trump Administration, which could create tariffs and trade wars that dampen both air cargo demand and business travel.
Offsets and carbon capture as well as new technologies such as electric and hydrogen are elements of the plan, but the production of enough sustainable aviation fuel (SAF) is the major component.
Unfortunately, while the amount of sustainable aviation fuel being produced is increasing, it’s going slower than planned.
“Governments are sending mixed signals to oil companies which continue to receive subsidies for their exploration and production of fossil oil and gas,” said IATA’s Willia Walsh, “And investors in new generation fuel producers seem to be waiting for guarantees of easy money before going full throttle.”
A lot has changed when it comes to buying an airline ticket.
You no longer need to go to an airline ticket office, wait in line, and buy a paper ticket.
These days, airline tickets are almost exclusively purchased online. And the ‘when’ of buying an airplane ticket has changed too.
Here’s a slightly different version of a story we put together for the Lonely Planet site with tips for timing your flight purchase.
Monitor before you buy
If you can, start your hunt for the best airfare well before the date you want to fly. That will help you recognize and respond when fares dip or begin to rise.
You may not get the absolute lowest fare, but you’ll know that you’re getting a fair fare.
For international trips, that means starting to monitor fares up to 6 to 7 months in advance and purchasing 3 to 5 months in advance, says Haley Berg, Lead Economist at booking site Hopper.
When looking for domestic flights, start searching fares 3 to 4 months before you plan to take a trip, says Berg, and purchase 1 to 2 months before takeoff.
And if you can’t plan that far ahead, “the main thing to remember is the 21-day rule,” says Scott Keyes of airfare search site Going.
He notes that most fares include in the fine print an advance purchase requirement, which says that the cheapest fare is only available if booked at least, say, 21 days before travel. “On Day 20, that previously cheapest fare expires, and the new cheapest fare is often $100 or $200 more expensive.”
Price tracking tools, services, and apps, such as Google Flights, Kayak, Hopper, Skyscanner, and many others do a good job of monitoring fares for you and alerting you to deals and ideal times to buy.
Go ahead and use one of the flight search engines to compare flights across many airlines, says Keyes, but once you find the flight you want, it’s best to purchase your ticket directly from the airline.
Why?
“Certain legal protections only apply when you book directly with the airline,” says Keyes. Most notably the US federal government’s 24-hour rule requires airlines to give you a full cash refund within 24 hours of purchase if you change your mind about buying that ticket because, say, you found a better fare or your plans change right away.
Also, not having a go-between can mean fewer hassles if there is a weather delay or some other problem on the day of your scheduled flight.
Booking myths
Airlines constantly rejigger fares according to a myriad of algorithms that can change in seconds, minutes, or hours.
So, while there may not be a best or cheapest time or day to book your flight, there are some best times to take your flight, says Keyes, “Business travelers tend to avoid flying Tuesday, Wednesday and Saturday, so airfares are often 30% to 40% cheaper on those days.”
Beware of cheap fares
Many of the airlines’ cheapest fares come with multiple stops, super long layovers, and stricter rules for refunds and rebooking. Others may impose extra fees for everything from choosing your seat to printing out a boarding pass or putting a bag in the overhead bin. Be sure to check the fine print so you do not get surprised.
(This is a slightly different version of a story we prepared for NBC News)
Starting Nov. 8, the United States will begin welcming welcoming fully vaccinated international air travelers, under a new less restrictive set of Covid-19 regulations.
The new rules require that, with very limited exceptions, non-U.S. citizens flying to the U.S. from more than 30 countries must be fully vaccinated and test negative for the coronavirus three days before they board their flight.
“For passengers who are not fully vaccinated, the rules will tighten to require a test taken no more than one day before departing to the United States,” the Centers for Disease Control and Prevention said in a statement.
The CDC is also requiring airlines to collect contract tracing information from passengers boarding flights to the United States.
The relaxed restrictions are good news for a U.S. travel industry that has been hammered by the pandemic — and (mostly) good news for international travelers hoping to visit the U.S. for business or leisure.
Already, airline searches — and sales — for flights to the U.S. have spiked.
“We have seen an increase in ticket sales for international travel over the past weeks, and are eager to begin safely reuniting the countless families, friends and colleagues who have not seen each other in nearly two years, if not longer,” Nicholas Calio, president and CEO of airline trade association Airlines for America, said in a statement.
Along with increased tickets sales, though, come increased prices. The cost of an international flight is up by an average of 12 percent from last month, Adit Damodaran, economist for travel booking app Hopper.
“We expect international prices to rise another 15 percent from now until the holidays,” he said.
Travelers heading to the U.S. are likely to find crowded airports and long check-in lines.
Many airlines are still struggling with staffing and retraining issues, said Daniel Burnham, senior member operations specialist at Scott’s Cheap Flights. And because airline personnel will now be tasked with verifying vaccine records and Covid-19 test results at the check-in counter and collecting contact tracing information, “this will likely cause crowding in the early days of implementing these new rules at many European airports.”
What will happen to airfares and hotel rates?
“Travel searches on Expedia and Hotels.com have been simmering in anticipation of the borders reopening and came to a full boil the moment the U.S. pinpointed November 8,” said Melanie Fish of Expedia Brands. “Increased demand in 2022 is likely going to mean fewer travel bargains are out there.”
The bargains are likely to fade first at hotels in popular U.S. cities. “It’s expected that city hotels in the U.S. will be in high demand — a reverse in trend over the past 18 months,” says Misty Belles, vice president for global public relations at Virtuoso travel network. “So, say goodbye to low rates and flexible cancellation policies.”Cities such as Orlando, New York, and Seattle are excited to welcome back international visitors, who contributed significantly to local economies in typical, pre-pandemic years.
Casandra Matej, president and CEO of Visit Orlando, notes that the new requirements for vaccinated international travelers visiting the U.S are “especially valuable for families traveling with children under age 18, who will be exempt from the vaccination requirement and allowed entry as long as they meet the negative testing requirements.” That’s a plus for the theme-park-rich Orlando area.
Kauilani Robinson, director of public relations for Visit Seattle, said “we hope to see our international visitations climb back to pre-pandemic levels, but know it will take some time to get there since travel booked right now is largely cautionary travel and booked at the last minute. But we’re expecting to see that increase as we get into November.”
In New York City, international travel typically generates 50 percent of tourism spending and 50 percent of hotel room nights. “International visitors stay longer and spend more,” said Fred Dixon, president and CEO at NYC & Company, the city’s visitors bureau. “The decision to open international borders safely is the news we have been waiting for and the shot in the arm for our industry.”
There is not yet a universally recognized mobile travel pass or travel passport for vaccine and COVID-19 test results. But there are tools, to help travelers figure out what will be required of them at the check-in counter. These include Delta FlyReady, United Airlines’ Travel-Ready Center, and Verifly, which is used by American Airlines, Alaska Airlines, and others. IATA, the International Air Transport Association, has developed a Travel Pass currently recognized by more than 50 international airlines.
Bonus: Here’s a short spot we did for NBC News Now based on this story.
Even the savviest traveler can use a few new tricks each year, whether on the road for business or leisure.
So here are some of the expert tips I gathered for a recent CNBC Road Warrior piece.
Fly Frugally
Before the end of the year, take inventory of your frequent flier miles. Claim credit for any missing miles and decide if you can top off—with an extra flight, hotel stay or mile-generating purchase—accounts where you are close to getting elite status perks for the following year.
When shopping for new flight reservations, sign up for fare alerts, enlist helpers such as Kayak’s price forecasting tool and remember the “24-hour reservation requirement” put into effect in January 2012 by the U.S. Department of Transportation. The rule requires carriers to hold a flight reservation for 24 hours without payment, or allow a reservation to be canceled within 24 hours without penalty if the reservation is made one week or more ahead of the flight’s departure date.
“If you see an airfare you’re comfortable with, book it,” said Kayak spokeswoman Maria Katime. You can continue your research and, if you find something better, go back and cancel.
Reasonable rental cars
When it comes to cars, reserve once you know your dates and have done some shopping, but recheck prices closer to the time of travel. “Prices can drop last-minute, depending on the actual availability of cars versus what the companies anticipate,” said travel expert Carol Pucci, who saved more than $100 with this method on the Big Island of Hawaii. “It was easy to do because I hadn’t prepaid, which is hardly ever a good idea given the chances of prices falling,” said Pucci.
To make sure a rental car company doesn’t charge you for scrapes, scratches or dings already on the car you’re issued, “take pictures of the car before you drive it away and when you return it,” said Joe Brancatelli, publisher of the business travel website Joe Sent Me.
“Rental firms are getting extremely aggressive about these charges and since the cars in the fleet are older these days than they used to be, there’s more of a chance you’ll be given a car with a ding and/or scratches,” he said.
Honing in on hotel deals
Sign up for the frequent stay program of any hotel you visit to take advantage of free perks that can include complimentary breakfast, free Wi-Fi and welcome amenities such as cheese plates and bottles of wine for even the first-time guest.
Research room rates and hotel property reviews online, but as a final step, call the hotel you’ve chosen. “Once I narrow down my hotel choice, I call the hotel to see if they have any better offers then what I see online,” said Rob Connors, assistant vice-president of marketing for National Car Rental. “Your membership in a club or association might get you an added discount, and many times hotels offer special rates for suppliers calling on nearby companies.”
It’s also a good idea to check city tourism sites for short-run, special promotions.
Some cities have destination marketing funds and packages designed to generate room sales during off-seasons. The inaugural Hotel Week LA runs from Nov. 29 to Dec. 14, and in 2015, more than 30 Manhattan properties are participating in the fourth New York Hotel Week from Jan. 3 to 18. The programs offer significant discounts rate for some of each city’s top, usually very pricey, properties.
Vancouver’s “Be Vancouver” promotion gives guests $125 American Express prepaid gift cards for bookings made by Nov. 16 for stays through Feb. 28, bringing rates in some upscale hotels down to less than $60.
“The offers coming from that program are the best we have on offer,” said Jim Mockford, general manager of the Listel Hotel. “They’re highly targeted in regards to time frame, so you have to be quick and flexible. So it’s always a good idea to put your name on the mailing list of your favorite hotels. You’ll hear about some great deals that you’ll never see anywhere else.”
Choosing travel gear
To get the best bang for your buck when shopping for travel gear “make a list of three to five ‘musts’ for your new bag and prioritize these as you do research,” said Michele Marini Pittenger, president of the Travel Goods Association.
“The manufacturer’s warranty policy can be an indicator of durability, but be sure to check the dimensions of new carry-on bags to avoid getting dinged by extra charges when flying,” she said.
When to use a travel agent
Modern online booking tools and mobile apps make it easy to research and reserve much of your own travel. But the customer services of a travel advisor who can quickly reroute and rebook you when there’s a travel snafu can come in handy.
“When it’s a trip that matters—family vacations, celebration travel, a destination you want to experience rather than ‘see’—that’s when you most need a travel advisor,” said Matthew Upchurch, chairman and CEO of Virtuoso, a network of luxury travel agencies. “Not only will they save you precious time, they can save you money with negotiated hotel benefits and extensive firsthand knowledge to ensure that you get exactly what you expect from the trip.”
Boarding the bus
“Bus travelers typically save 50 to 55 percent versus the train and 55 to 73 percent versus flying,” said Joe Schwieterman, a professor at DePaul University in Chicago and author of the Traveler’s Tradeoff study comparing intercity bus, plane and train fares across the United States.
“The ‘sweet spot’ for bus travel involves trips between 125 and 300 miles. Driving can be tedious, but air travel is often not cost effective,” he said.
When to book the bus?
“As early as possible,” said Megabus spokesman Mike Alvich. “Generally customers booking 30 to 45 days in advance will see the greatest savings, but even last-minute trip tickets are still very affordable in comparison to last-minute airline travel or even the cost of filling the gas tank of your personal vehicle.”
Smarter destination choices
You may not have much choice where business trips take you, but you can save money on leisure trips and avoid crowds by heading for South Africa, Shanghai, Uruguay, Portugal or some of the other “best-value” destinations on Lonely Planet’s Best Travel 2015 list.
Choosing “almost-as-good” alternatives to classic experiences in more expensive cities can also save cash.
“European cities are stuffed full of amazing historic buildings and churches that can be seen and explored for free without the crowds of big-name things,” said Lonely Planet’s editorial director, Tom Hall. “Gorilla trekking might be an unforgettable experience in East Africa, but looking out for chimpanzees and smaller primates can be much more fun and is certainly easier on the wallet.”