July 25, 2024
Industry News

Record-breaking number of Americans expected to travel for July Fourth: “Unprecedented levels of travel anticipated”

Heavy traffic on Interstate 93 heading south out of Boston, Wednesday, July 3, 2024, as people leave the city. (Getty Images)

NEW YORK — Despite soaring fuel costs and the looming hurricane threat, Americans are gearing up for record travel this summer to celebrate the Fourth of July holiday.

AAA projects nearly 71 million travelers around the Independence Day holiday, mirroring pre-pandemic levels. Approximately 60 million individuals will opt to drive, while close to 6 million will choose air travel, with around 4.6 million opting for buses, trains, or cruises during the holiday season.

“We’ve never seen numbers like this,” stated AAA spokesperson Andrew Gross. “2024’s travel appears to be on par with what was expected in 2020 before the pandemic hit,” he added.

This year’s summer travel in the U.S. holds significant importance, serving as a key indicator of consumer sentiment during an election year for central bank officials and policymakers.

Inflation remained stable in May despite an increase in consumer spending, sparking hopes that the U.S. Federal Reserve can manage inflation without triggering a recession.

While gasoline prices have slightly declined recently, the national average for a gallon of gas sits at $3.50 on Tuesday, down by 3 cents from last year. Domestic airfare is also 2% more affordable than the previous year, with the average domestic round trip costing $800, according to AAA data.

‘Desire to Travel’

Despite the upward trend in fuel prices, vacation plans remain unaffected by the higher costs this year, as per a survey conducted by American Trucks.

U.S. gasoline demand hit a one-year peak last week at 9.2 million barrels per day as retailers stocked up for the holiday, according to EIA data. Jet fuel demand also reached 1.7 million barrels per day, matching a seven-month high seen earlier in June.

“Consumers’ mindset seems to be more influenced by the rate of change rather than the actual price of gasoline,” noted John LaForge, head of real asset strategy at Wells Fargo Investment Institute.

As Hurricane Beryl continues to wreak havoc in the Caribbean Islands, U.S. vacation travel is unlikely to be impacted, with the hurricane projected to weaken significantly upon reaching Mexico’s Yucatan Peninsula by Thursday night.

U.S. fuel stockpiles are currently higher than in previous years, providing a cushion for consumers in case of any sudden price fluctuations due to disruptions in refining operations caused by the hurricane.

“Americans are eager to travel and remain optimistic, that’s for sure,” commented GasBuddy analyst Patrick De Haan.

FAQ

Q: Are fuel prices expected to continue rising?

A: Despite recent fluctuations, fuel prices are expected to stabilize in the near future.

Q: Will the hurricane affect travel plans?

A: Travel in the U.S. is unlikely to be greatly impacted by Hurricane Beryl’s trajectory.

Conclusion

Americans are showing strong enthusiasm for travel this summer, despite challenges such as high fuel costs and potential weather disruptions. The record-breaking number of travelers signifies a return to pre-pandemic levels of vacation activity, demonstrating a resilient consumer sentiment.

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