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Travel, Airline, Hotel & Tourism Industry Market Research




Travel Industry:

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Introduction to the Travel Industry

¹ Video Tip
For our brief video introduction to the Travel industry, see www.plunkettresearch.com/video/travel.
 
The global travel industry is comprised of a wide variety of businesses, from hotels and inns to casino resorts, trains, buses, airplanes, cruise ships, tour operators and travel bookers, both online and physical. According to the World Travel & Tourism Council (WTTC), nearly 1.1 billion tourists traveled the world during 2013, a new record high.
WTTC found that the global travel and tourism industry supported 101 million jobs on a direct basis in 2013. The industry generated $2.155 trillion in direct global contribution to GDP (gross domestic product) during 2013. The U.S. International Trade Administration (ITA) estimated direct travel and tourism expenditures in America at $900.1 billion during 2013, and total international traveler spending in America at $180.7 billion.
International passenger travel is a bright spot. For example, the ITA expects international arrivals in the U.S. to grow from 69.8 million visitors in 2013 to 83.8 million in 2018. Hotel occupancy and airline traffic have been strong during recent years in emerging nations including India, China and the surrounding Asian region, as well as in Brazil.
Hotels and resorts have been enjoying good to excellent occupancy rates, which enabled them to raise prices, while many new properties have been built or are under construction in promising markets. Business travel has rebounded considerably over the dismal recession years of 2008-09, while leisure travel has been generally strong worldwide. Nonetheless, when members of the European or American middle class do take a vacation, it is generally on a reduced budget. Businesses are sending more employees on trips, but keeping a tight rein on costs at the same time.
The International Air Transport Association (IATA), the international association that represents most of the world’s major airlines, estimated a global airline industry net profit of $10.6 billion for 2013, growing to $18.0 billion in 2014 due to improved business strategies, increased fee income and high seat occupancy levels.
In the U.S., major airlines have cut routes and reduced the total number of seats available, partly by removing older, fuel-guzzling aircraft from service. This put the airline industry in a much more efficient operating condition. U.S. airlines are operating with much smaller staff counts, and to a large extent they were able to renegotiate union contracts in recent years in order to reduce wage costs. All of these steps, combined with a shift in strategy that relies on fees for services such as checked baggage, has resulted in a much healthier airline industry in America, and improved profits. The number of employees in the U.S. scheduled airline industry plummeted from 485,000 in 2003 to 410,600 in 2013.
The 2008-09 recession was an ugly time for airlines. Many took bankruptcy protection in 2008, including Frontier, and some, such as Aloha Airlines and ATA were forced to discontinue operations altogether. Several specialty and business-class-only airlines ceased operations also, including MAXjet, Eos and Skybus. Government-controlled Alitalia, in Italy, took bankruptcy in August 2008. Japan Airlines took bankruptcy in 2010, stating it would cut more than 15,000 employees.   More recently, in 2011, American Airlines filed for bankruptcy. It was unique among the major airlines in that it had not been able to get unions to cut wages. As a result, its labor costs were very high compared to the rest of the industry. American soon emerged from bankruptcy and merged with U.S. Airways; the newly combined companies use the American Airlines brand.
For the near future, advanced new aircraft will bring significant changes in the global airline industry. Boeing’s 787, with the first delivery made to Japan’s ANA airline in September 2011, enables international airlines to offer great enhancements to passenger comfort with extremely long intercontinental range, while the airlines will benefit from a fuel efficiency boost of about 20%. Boeing enjoys a massive backlog of orders for this advanced aircraft, despite recent technical problems that were painful to solve. Although this mid-size aircraft carries fewer passengers than the massive Boeing 747 and Airbus’ giant A380, it enables airlines to open up many new, direct routes. For example, new flights from Europe directly to growing markets in Africa and Southeast Asia will be introduced. Likewise, new routes from markets in the U.S. such as Denver or Minneapolis, that historically have not been major jumping off points for direct flights to Europe or Asia, will likely be tried.
A modest number of Airbus A380s had been delivered by mid-2014, typically set up to carry about 550 passengers in great comfort from one global capital to another. Airbus enjoys a decent backlog of orders for this aircraft, particularly from airlines based in Middle Eastern nations, but sales are nonetheless disappointing overall.
Perhaps more important is the spectacular demand from global airlines for smaller, single aisle planes to replace older models that are not particularly fuel-efficient. Boeing will build a new high-efficiency version of its exceptionally popular 737, to be called the 737 MAX, which will compete with a similar offering from Airbus, an A320neo model with a new engine option. Massive numbers of both of these aircraft will be sold over the long term.
Among international carriers, the upstart Emirates has carved out a place for itself as a major long-haul airline. It offers routes spanning the entire world with a major hub in the Middle East. Etihad is another Middle Eastern carrier that is getting rave reviews for its first class suites.
Discount airlines remain very important players in the U.S. as well as in Europe and the rest of the world. Southwest Airlines is one of America’s top carriers by number of passengers, and JetBlue has enjoyed very rapid growth. Outside the U.S., many carriers have carefully studied Southwest’s methods and strategies, and have enjoyed strong growth. Good examples include Dragonair in China and Ryanair in Europe.
E-commerce continues to play an extremely important role in the travel sector, making booking convenient for consumers and more cost-effective for travel providers. However, online travel booking sites like Orbitz and Expedia face tough competition. Airlines and hotel chains operate their own powerful online reservation systems, with rich features, multiple levels of photos and descriptions, and programs for managing frequent traveler rewards. Consumers often find the lowest prices on sites operated directly by airlines and hotels.
The cruise line business has enjoyed solid growth, despite the recent financial crisis. Consumers see cruises as high-value package deals, and cruise ships are nearly full. Cruise companies are hopeful that their “all-inclusive” fare model will continue to attract cost-conscious travelers in addition to luxury cruisers. Some of the newest ships, such as Royal Caribbean’s “Allure of the Seas” are among the largest passenger ships ever built. An estimated 11.79 million passengers were carried on North American cruises during 2013, forecast to grow to 11.98 million in 2014.

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Video Introduction to Travel, Airline, Hotel & Tourism Industry
Complete list of market research data provided by Plunkett Research, Ltd. for the Travel, Airline, Hotel & Tourism Industry
  • Discount Airlines Compete with Legacy Airlines, but the Differences Are Beginning to Blur
  • Major Airlines Change Strategy, Charge Fees and Boost Profits
  • Some International Airlines Cut First Class Seats and Add to Business Class
  • ADS-B Improves Air Traffic Control
  • Private Jet Rentals Grow in the Form of Memberships and Fractional Shares
  • Boeing and Airbus Enjoy Boom in Orders/Major Aircraft Market in China
  • New Aircraft Designs Offer Greater Passenger Comfort/More Efficient Engines
  • In Flight Wireless Takes Off
  • Air Traffic Grows/Airports in Middle East and Asia Have Strong Traffic
  • Massive, Long Term Growth in China’s Travel Market/Indian Travel Market Rebounds
  • Online Travel and Tourism Booking Continues Strong Growth
  • Sustainable Tourism and Ecotourism Grow as Certification Standards Emerge
  • Hotel Market Rebounds/Luxury Chains Expand while Pod Rooms Grow in Popularity
  • Cruise Industry Market Is Strong while Capacity Soars with New Ships
  • New Technologies Show Promise for Port and Airport Security
  • High-Speed Passenger Trains, Including Maglev, Advance in China and Europe
  • Self-Check-In Kiosks, RFID and Wireless Technologies Save Costs and Enhance Travelers’ Experience at Airlines and Hotels
  • Aging Baby Boomers Will Cause Significant Changes in the Leisure Sector, Including Sports and Activity-Based Travel
  • Private Space Vehicles Begin to Fly, Including the SpaceShipTwo, but 2014 Crash May Slow Development
  • The Future of Travel
  • Complete list of statistics data provided by Plunkett Research, Ltd. for the Travel, Airline, Hotel & Tourism Industry
  • Airline, Hotel & Travel Industry Overview

  • Air Carrier Traffic Statistics, U.S.: 1981-2013
  • Air Carrier Traffic Statistics, U.S.: 12 Months Ended April 2014 and April 2013
  • Consolidation in the U.S. Passenger Airlines Industry
  • Annual U.S. Domestic Average Itinerary Air Fare: 1995-2014
  • U.S. Aviation Industry Average Annual Percentage Growth Forecasts by World Region: 2013-2034
  • U.S. Airline Passenger Activity: 2000-2034
  • Total Scheduled U.S. International Passenger Traffic, U.S. Commercial Air Carriers: 2000-2034
  • International Visitor Arrivals to the U.S.: Selected Years, 2000-2013
  • International Visitor Arrivals to the U.S., Forecast: 2013-2018
  • Top Destinations of U.S. Residents Traveling Abroad (Outbound): 2012-2013
  • Domestic Airline Jet Fuel Prices, U.S.: January 1986-May 2014
  • Quarterly System Operating Profit & Loss Margin for U.S. Airlines: 1st Quarter 2013-1st Quarter 2014
  • Top 10 U.S. Airlines & Airports Ranked by 2013 System Scheduled Enplanements
  • U.S. Airline Revenue Passenger Enplanements: January 1996-April 2014
  • Cruise Line Industry Overview, U.S.: 2009-2013
  • Amtrak Ridership: January 1991-June 2014
  • Rail Passenger Capacity Utilization, U.S.: January 2003-June 2014
  • Highway Vehicle Miles Traveled, U.S., Monthly: January 1990-May 2014
  • Quarterly Growth in Real Tourism Spending & Real GDP, U.S.: 2000-2014
  • Transportation Services Index, U.S.: January 2000-May 2014
  • Percent Change in the U.S. Transportation Services Index (TSI) from Year-to-Year: 2005-2014
  • Employment in the Airline, Hotel & Travel Industry, U.S.: 2007-2013
  • Table of Contents for Plunkett's Travel, Airline, Hotel & Tourism Industry Almanac  
    See Full Table of Contents

    how to use this book 3
    chapter 1: major trends affecting the airline, hotel & travel industry 7
    1) introduction to the travel industry 7
    2) discount airlines compete with legacy airlines, but the differences are beginning to blur 9
    Profiles of Leading Travel, Airline, Hotel & Tourism Companies are provided, including Public, Private, U.S., and non-U.S. Firms.  
    See Full List of Companies

    • AAA (American Automobile Association)
    • Accor North America
    • Accor SA
    • ADA
    • Aer Lingus Group plc
    • AerCap Holdings NV
    • Aeroflot Russian Airlines JSC
    • Aerolitoral SA de CV (Aeromexico Connect)
    • Aeroports de Paris
    • Aerovias de Mexico SA de CV (Aeromexico)
  • Aerovias de Mexico SA de CV (Aeromexico)
  • Air Berlin plc & Co Luftverkehrs KG
  • Air Canada
  • Air China
  • Air France-KLM SA
  • Air India Limited
  • Air New Zealand Ltd
  • Air Partner plc
  • Air Wisconsin Airlines Corp
  • AirAsia Berhad
  • Key Travel, Airline, Hotel & Tourism Industry Topics
  • Hotels
  • Hospitality
  • Developers
  • Resorts
  • Tourists
  • Business Travel
  • Leisure Travel
  • Airlines
  • Discount Airlines
  • Cruise Ships and Cruise Lines
  • Passenger Railroads
  • Consolidators
  • Travel Agents and Agencies
  • Online Booking and Internet Travel Research
  • Consolidation
  • Profiles of Leading Companies
  • Executive Mailing Lists