This report highlights the latest insights from the Skift Travel Health Index. The index covers travel’s performance since January 2020, up to and including February 2022.
The Skift Travel Health Index is a real-time measure of the performance of the travel industry at large, and the core verticals within it. The Index provides the travel industry with a powerful tool for strategic planning, which is of utmost importance as times remain uncertain.
Skift Research launched the Index in May 2020 as the Skift Recovery Index. At the start of 2022 we rebranded the Index as the Skift Travel Health Index, to reflect some far-ranging changes: the addition of many more indicators, additional data partners, and most importantly, our continued effort to track the industry health beyond the impact of the Covid-19 pandemic.
We are thankful for the support of our data partners: Amadeus, Aviasales, Beyond, CarTrawler, Cendyn, Collinson, Criteo, Duetto, ForwardKeys, Hotelbeds, Key Data Dashboard, OAG, Onyx CenterSource, OTA Insight, RateGain, Shiji Group, Skyscanner, Sojern, Transparent, and TrustYou. Their data allows us to provide you with a monthly assessment of travel’s performance.
February One of the Strongest Increases Since Index Began
The Skift Travel Health Index global score, which is a weighted average of scores for the 22 countries we track, registered an impressive 9 percentage point increase between January and February, to now stand at 74. This means that the travel industry performance currently tracks 26% below 2019 levels.
While the invasion of Ukraine is understandably taking all the highlights, the overall improvement of the travel industry’s performance was impressive during February. The overall travel performance hasn’t grown this fast month-over-month since March 2021. The 9 percentage point increase of the global average Index score is the second largest month-over-month increase since the beginning of 2020.
Furthermore, the Index score for February 2022 is only 5 percentage points lower than the score in February 2020, when the impact of Covid was only really felt in China.
Search levels for flights, hotels, and car rentals were up across the board compared to last month. Flight and hotel searches remain considerably down from 2019 levels, but search volumes improved in all regions for both sectors. Searches for car rentals were above 2019 levels in February in all regions except Asia Pacific, with particularly Latin America (driven by Mexico) registering a very strong performance.
New bookings were also strong in February. Flight, hotel, and car rental bookings all registered improvements compared to January in all regions, although sector performances continue to fall far below 2019 levels. One exception is flight bookings in North America, which moved above 2019 levels in February.
Price levels also remained high in February. Data from OTA Insight shows that published rates for hotels were above 2019 levels in all regions, with rates in the United Arab Emirates jumping the most. Rates in the U.S. were 17% above pre-pandemic levels in February, compared to +11% in January.
Vacation rental data from Transparent and Key Data Dashboard shows that average room rates for stays during the next three months are also staying strong, with prices consistently between 20% and 40% above 2019 levels during February.
The Impact of Russian Aggression on Travel
February data is not showing the full force of current circumstances on Russia’s performance yet, but this is likely to change in the March data. The Russian invasion of Ukraine started on the 24th of February, with most analysts and officials holding out hope that the invasion would not happen. This means that only four days of February data was impacted by the war. Nevertheless, Russia was only one of two countries that showed a decline in performance during February.
The Russian travel industry has been one of the strongest performers since the inception of the Skift Travel Health Index. The decline in February now pulls Russia close to the global average, and March is likely to see Russian travel performance dive below this average.
Russia’s pandemic travel performance particularly benefited from a strong domestic market. While international seat capacity from flights to and from Russia remains down, domestic airline seat capacity has been above 2019 levels since early 2021, and Russian airports have been seeing some of the highest throughput according to OAG data.
Data from Aviasales, a major Eastern European booking site and one of our data partners, shows that searches for domestic Russian flights were still 88% above 2019 levels during February 2022, and domestic bookings 94% higher than in 2019.
In January, new bookings made for Russia outperformed the global average in aviation and vacation rentals, while hotel bookings were on par. In February, the situation turned on its head. Aviation and hotel bookings saw strong improvements at a global level, but in Russia, they took a step back, with the negative gap to 2019 levels widening. February flight bookings, however, still performed better in Russia than globally.
A deeper dive into the last week of February data, however, gives us a more accurate outlook into what might unfold for the Russian travel market in the months to come.
According to data from our partner ForwardKeys, on February 25, every booking that was made for travel to Russia was outweighed by six cancellations of pre-existing bookings. The Russian outbound market has also collapsed, with 11 airports completely shuttering operations.
The domestic market will also suffer. Many foreign leasing companies have recalled planes leased to Russian airlines, although the Russian government moved in and impounded many of these before they could be returned. Furthermore, major manufacturers like Boeing and Airbus will no longer provide parts and maintenance to Russian airlines anymore, meaning that an increasing amount of planes will become grounded.
But the rest of the world will feel the impact too.
According to data from ForwardKeys, flight tickets issued during the week after the invasion were down across Europe, with the exception of only a few countries. This is not only due to the closing of borders to Russian travelers, but also travelers to other countries postponing or altering travel plans due to the increased uncertainty.
Olivier Ponti, Vice President of Insights at ForwardKeys, noted, however, that Western European destinations are not severely hit by the war as of yet. He said: “What I find surprising is that transatlantic travel and western European destinations have been less badly affected than I feared – North Americans can tell the difference between war in Ukraine and war in Europe, and so far, it seems that travellers regard the rest of Europe as relatively safe.”
This does not mean that there are no impacts on future travel plans. Russia’s airspace is now closed to many airlines from Europe and North America, and many others are avoiding it for safety reasons, meaning that long haul flights from Europe and North America to Asia will become longer, and potentially will require a refuelling stop. With oil prices also surging due to the war, some airlines like Malaysian Airlines have already started adding fuel surcharges to their prices.
Two countries in Europe are interesting to watch: Turkey and Serbia.
Turkey has condemned the Russian violence and closed its straits for Russian warships to enter or exit the Black Sea, but its airspace remains open for now. The country will walk a fine line, as Russia is important to the country’s energy supplies, but also as a tourism source market. According to data from the Turkish Ministry of Culture and Tourism, Russia is the country’s largest source market, with 7 million Russians arriving in 2019, 16% of total international arrivals. During the pandemic, the share of Russian tourists even grew to 19% in 2021.
Despite pressure from the EU to rescind their neutrality, Serbia has taken a neutral stance and has remained open to Russian flights, making it a gateway for flights to the rest of Europe from Russia. According to ForwardKeys, “60% more flight tickets were issued for travel from Russia to another destination via Serbia in the week immediately after the invasion than there were in the whole of January.”
The sanction on Russian outbound travel is also seen as an opportunity by other countries, including the United Arab Emirates. ForwardKeys data shows that airlines including Flydubai, Emirates Airlines, and Etihad Airways did not see a decrease in capacity since the invasion, and actually slightly increased available seats for flight to and from Russia. Russian airlines like Azimuth Airlines are launching new routes to Dubai, with the emirate welcoming the Russian superrich. Russian travelers will increasingly look to the UAE, as well as countries like Egypt and Asian hotspots, like Thailand, if sanctions from the U.S. and EU remain, which seems very likely.
With the Ukraine war raging on, and China now seeing some of its highest infection rates recorded, it is likely that March will be less positive than February, although in many other parts of the world final travel restrictions are being lifted. If nothing else, the travel industry has become accustomed to the fluctuations that come with this choppy recovery.
Skift Research collects and analyzes data from 20 different data partners, to provide the most comprehensive view of the travel industry’s performance.
The Index tracks 84 indicators per country to assess the health of the travel industry in each country. These indicators are aggregated into performance categories and sub-categories. The top level of division is by travel vertical, and each vertical is further divided by intent indicators, booking indicators, and key performance indicators.
The Index covers the following travel sectors:
The Index focuses on the travel performance in 22 of the largest tourism economies, combined accounting for 62% of inbound tourism receipts, 67% of outbound tourism expenditure, and 78% of global 2019 GDP.
– Hong Kong, China
– South Africa
– United Arab Emirates
– United Kingdom
Index Score Calculation
The Index is designed to provide an easy overview of the health of the travel industry. We have tracked the industry since the beginning of 2020. For 2020, 2021, and 2022 data, the performance of each indicator is compared to the same time in 2019. The Index provides a score relative to a baseline reading of 100 for the same month in 2019.
The full methodology document can be found on our website.
Disclaimer: All rights reserved; content based on data provided by Amadeus, Aviasales, Beyond, CarTrawler, Cendyn, Collinson, Criteo, Duetto, ForwardKeys (Forward Data SL), Hotelbeds, Key Data Dashboard, OAG, Onyx CenterSource, OTA Insight, RateGain, Shiji Group, Skyscanner, Sojern, Transparent, TrustYou. The content and the data provided in this document are for your information and internal use only. The content is provided “as is” without any warranty as to accuracy, completeness, satisfactory quality or fitness for any particular purpose. It is strictly forbidden to extract, reproduce, republish or publicly display any content included in this document without the prior written authorisation of Skift Research. If you wish to use any of this content or similar data, please contact Skift Research for more information.