The Post Covid Travel Season Apocalypse

The Post Covid Travel Season Apocalypse

There’s a storm brewing. It’s not quite here, but you can feel the electricity in the air – the excitement. Perhaps you’ve heard someone talk about it recently? They’re making plans to travel the world, or at least Disney Land, when all this pandemic business blows over. People everywhere have had these thoughts festering in their minds for months. Soon they will put on their Hawaiian shirts and fanny packs and roam every beach and amusement park known to man. Anyone can predict it will be a strong travel season, but I think it will be more than that. It will be the travel season to end all travel seasons

The Vacation Zeitgeist

It may seem obvious, but people have been stuck at home for a year and want to go somewhere and do something. People are planning their vacations with the same zeal as a 20 year old planning to go bar hopping for their next birthday. Even people who normally don’t travel, have been bit by this bug. It won’t go away. I know from experience that the freedom and joy of traveling becomes addicting. We all know the torturous feeling of returning to work after a week or two of absolute vacation bliss. People will travel, enjoy it, and never want to go back.

We are about to witness a new generation of globe trotters. Vacations won’t just be something you do occasionally, they will become personal hobbies. Travelers will collect passport stamps and park wristbands. Vacationing will be a luxury. This trend has already developed in social media like Instagram. People see lives that appear to be nothing but traveling and partying, and they want their life to be like that too. If they can afford it, that is.

The Money

We’re at a confluence of factors that will let traveling explode at an unprecedented level. The desire to travel is clearly there, and the money is following close behind.

I don’t want to get into the technicality of whether our economy is currently in a bubble or not, my guess is “yes”, but it’s irrelevant. The point is there is a lot more money out there now than before the pandemic started. Most of that money has been hoovered up by the extremely wealthy, the 1% of the 1%. But a usable portion of that wealth is also accessible to much of the middle and upper middle class. Have a used pickup Truck? Congratulations! It’s now worth twice as much! If you have a house, a quick cash-out refinance could both save you monthly payments and give you direct access to hundreds of thousands of dollars. What I’m saying is if you held onto any asset for the past year, you have accumulated enough extra wealth to take a vacation. There’s also been a recent increase in wages, both from increase in minimum wage and from the difficulty companies have in finding employees. Lastly, the US government flat out gave people thousands of dollars in the form of stimulus checks or extended unemployment benefits. The end result is anyone who started out with money should be coming out of this pandemic with more.

All this extra money around will have an inflationary effect on prices. I am not talking directly about overall inflation here, but specific sector inflation caused by a sudden increase in demand and a lack of supply. We’ve seen this happen repeatedly throughout the pandemic cycle. Remember when Toilet paper was scarce and suddenly very expensive? These inflationary shocks have been floating from sector to sector for the entire past year. Flights and hotels fell in prices while electronics rose. Housing prices increased ludicrous amounts. Now these pressures will direct a massive wall of money back into vacations and travel.

The Apocalypse

It’s all about supply and demand. The vacation demand has dwindled this past year. I would know since my business and income is directly linked to traveling. But it also has been increasing the past couple months. The March spring break rush was some of the best I’ve ever seen, and it’s only going to get better.

The demand is building. Half of the adults in the US are vaccinated. The death rate is plummeting everywhere the vaccine is widely distributed. Very soon it will be summer and there will be no restrictions. Everyone, and I mean everyone, is going to get out there.

But the supply will be a problem. Remember when earlier in the pandemic Hertz, the car rental company, went bankrupt and had to liquidate their fleet. Now that demand is picking up again it is nearly impossible to rent a car. My local airport has compact cars available to rent for hundreds of dollars per day for this weekend. Hotels and flights are becoming the same.

During the pandemic everything travel rated either scaled down or went bankrupt. Less people were flying so there were less flights, airlines sold or retired older craft to meet the new lesser demand. Hotels let go of staff and stopped using a percentage of their rooms. Some locations closed all together. There’s still a number of Las Vegas hotels that have never re-opened. These businesses will not be able to scale fast enough for the tidal wave of tourism that will increase over the next 3 months and reach a peak in July.

Just like how rental cars are difficult to find now it will be difficult to find affordable flights and hotels soon. Places like Disney Land will be so crowded, lines will take hours to wait through. It will undoubtedly be the busiest and priciest travel season of all time. I know this doesn’t make traveling sound appealing, but don’t worry, there is a secret to how you can still get your travel on affordably and avoid the crowds.

The Weekday Warrior

Those same cars going for hundreds of dollars per day can be rented for $13-$15 per day if you only use them during the week. In fact everything is still dirt cheap during the week and likely will continue to be. I’m seeing a new pattern, the paradigm in travel has changed, and that’s because of one reason.

There is no demand to bring back business travel. Now that video conferencing technology has matured and everyone is used to it, why would corporation spend thousands of dollars to send an employee physically somewhere? They wouldn’t. And this difference is creating an unbalance in the travel marketplace.

Before the pandemic, I’d see hotel bookings spread equally throughout the week. There would be a mix of business and pleasure so any one day wasn’t booked that much more than any other. Now it’s completely different. There’s 3 to 4 times as many bookings for weekends than a Tuesday. All the travel is pleasure, and the people who can afford it are the middle and upper middle class people who work office jobs and only have free time during the weekend.

If you’re looking to travel in this upcoming ultimate travel season, look at prices during the week. I’m sure you will be pleasant surprised at how affordable it can be. Soon you will be able to enjoy the world as you’ve always wanted. That is if your boss will let you take the time off during the week. Then once you get hooked on traveling, it’s time to consider the option where you become your own boss and have all the time to go wherever you please. But that’s a different topic for another time.