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Summer airfares from Europe to US drop to pre-pandemic

levels

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Western Europe travel to US declines, Eastern Europe

travel

rises

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Airlines adjust strategies amid changing transatlantic

travel

demand

By Doyinsola Oladipo and Joanna Plucinska

NEW YORK/LONDON, June 18 (Reuters) - Airfares from

Europe to the United States have dropped to rates not seen since

before the pandemic, as travelers from Western Europe lead a

pullback in travel to the U.S. that is expected to continue

through at least July.

Overseas arrivals to the United States fell 2.8% in May from a

year ago, according to preliminary data from the U.S. National

Travel and Tourism Office within the U.S. Department of

Commerce. Travel from Western Europe fell 4.4% in May although

travel from Eastern Europe rose 4.6% in the same period.

Forward bookings suggest sustained declines are on the

horizon, with total inbound bookings to the U.S. in July down

13% year-over-year, according to OAG Aviation, an analytics

firm.

Transatlantic airfare has been declining since the first

quarter when Europeans started reconsidering travel to the U.S.

after President Donald Trump suggested annexing Greenland,

launched a global trade war, and issued orders that focus on

stricter border policy. A stronger dollar has also deterred some

trips.

In March, travel from Western Europe fell 17%

year-over-year, according to the NTTO.

Average round-trip economy airfares for over 50 routes from

the U.S. to Europe in the first quarter were down an average of

7% year-over-year, with rates to fly between Atlanta, Georgia,

and London, down 55%, according to data from Cirium, an aviation

analytics firm.

As American consumers have been bargain-hunting and waiting

closer to their departure dates to finalize travel plans, the

decline in demand from Europe is another factor contributing to

cheaper travel.

"Fewer seats filled by European travelers to the U.S., and a

slower pace of growth in U.S. outbound to Europe than last year,

will tend to cast 2025 as a tougher year to make money on

transatlantic routes," said Aran Ryan, director of industry

studies at Tourism Economics, a subsidiary of Oxford Economics.

This summer, the price of round-trip tickets from the U.S.

to Europe is down 10% compared with a year ago, travel booking

app Hopper said. Average fares of $817 per ticket are in line

with prices to Europe in the summer of 2019 before the pandemic.

Major carriers, including Air France KLM and

Germany-based Lufthansa, expect slowing activity.

Lufthansa CEO Carsten Spohr said the company expects weaker

demand in the third quarter, while Air France KLM CEO Ben Smith

said the company is seeing a "slight pullback" in transatlantic

traffic and will slash prices to keep cabins on its

transatlantic flights full.

Airlines including Lufthansa and U.S. air carrier United

Airlines say higher demand from U.S. travelers flying to

Europe is offsetting the decline of Europeans flying the

opposite direction. United said international bookings from

Europe fell 6% in the first quarter, but added that

U.S.-originating demand made up for the pullback. Rival Delta

Air Lines ( DAL ) said 80% of its long-haul international demand

originates from the U.S., and fares in the region are

"significantly higher" than in the rest of the world.

Lufthansa said it plans to market its transatlantic flights

to more Americans given the higher demand, despite travel from

Western Europe showing moments of recovery. Travel from the

region to the U.S. increased 12.1% in April before falling again

in May, according to data from the NTTO.

As of mid-May, there are 4.3% more international flights

scheduled to depart from U.S. airports for international

destinations this summer, said Hopper.

"We feel really good about the transatlantic market,"

American Airlines CFO Devon May said at a Wolfe Research

transportation and industrials conference in May.