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Airlines face 10% drop in summer bookings despite lower

fares

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Hotel summer bookings flat year-over-year

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Dollar's weakness increases cost of overseas vacations

By Doyinsola Oladipo and Aishwarya Jain

NEW YORK, June 3 (Reuters) - This year's hottest summer

travel trend? Waiting for deals.

Americans are scaling back travel plans from flights to

drives or waiting to book only if the price is right, a

tell-tale sign of an industry slowdown that's got travel

companies worried.

Hotel summer bookings are either flat or falling from last

year, and airline bookings are down even though airfares have

also declined, as economic concerns fuel a pullback in

spending.

Travel companies including Delta Air Lines ( DAL ), Marriott

International ( MAR ), and online travel agency Booking Holdings ( BKNG )

have withdrawn or revised their 2025 annual forecasts

as U.S. demand softens. Airbnb ( ABNB ) flagged shrinking

booking windows as consumers take a "wait-and-see" approach and

book trips closer to their check-in dates.

That has left companies with less visibility into the second

half of the year. Delta said in early April it was premature to

project the full year given macroeconomic uncertainty. United

Airlines said there's a reasonable chance that bookings

could weaken.

"It's very clear that consumers are waiting to make

decisions, including for the summer," Southwest Airlines ( LUV )

CEO Robert Jordan said at the Bernstein Annual Strategic

Decisions Conference in late May, adding that demand was stable

but lower than expected in January.

U.S. summer flight bookings are down 10% year-over-year,

according to Flighthub, an online travel agency, even though

airfares have dropped.

"You can't keep an airline seat on the shelf in a warehouse.

If you don't fill that seat tomorrow and the airplane flies,

it's gone," Steve Hafner, CEO of Kayak, a Booking Holdings ( BKNG ) unit,

told Reuters.

Average summer flight prices declined 7%, with flights to

long-haul destinations like Sydney, Australia 23% cheaper

year-over-year, according to Kayak.

Hotel summer bookings in major U.S. cities are flat-to-down

year-over-year, according to data from CoStar. Average room

rates are expected to rise roughly 1.3% in 2025, down from a

1.8% increase in 2024.

"Travel is certainly under some pressure because people are

not feeling as comfy as they once did," said Michael Chadwick,

CEO of Fiscal Wisdom Wealth Management.

WEAKER DOLLAR

Travelers may start to find deals, such as a free third

night for staying two nights, as hoteliers look to fill rooms,

said Jan Freitag, national director of hospitality analytics at

CoStar Group.

That's what Jackie Lafferty is hoping for. Her summer plans

have shifted from a possible family vacation in Hawaii or

Florida to her home state of California instead.

"By the time we broke down the cost of the flights, the

hotel and the rental car, it looked expensive, it felt

unreasonable," said Lafferty, a Los Angeles-based public

relations director.

The dollar's weakness has driven up the cost of overseas

vacations. In March, American travelers surveyed by Deloitte had

planned to increase budgets for their longest summer trip by

13%. By April, Deloitte's survey found Americans planned on

spending about the same as last year.

"The dollar is just not going as far and I think people are

starting to realize that," said Chirag Panchal, CEO of the

Ensuite Collection, a Dallas luxury travel concierge. The dollar

has fallen about 10% since mid-January, when it was its

strongest in more than two years.

Panchal's clients, who had booked big trips to Europe last

year, are either staying domestic or going to closer

destinations like Canada or the Caribbean.

"We might go international at the end of the summer. If we

do, it will be last-minute and spur of the moment based on

cheaper flights," said Rachel Cabeza, 28, an actor and fitness

instructor based in New Jersey. For now, her only summer plan is

a getaway to Martha's Vineyard in nearby Massachusetts.