Travel Boom Predicted to Continue in 2025, but Expect Higher Costs and Squeezed Spaces

December 6, 2024 TruthUSA

The national appetite for travel didn’t diminish in 2024 and is expected to continue growing in 2025, according to recent data. But if you want to fly, be prepared to be squeezed—whether on a plane, in an airport lounge, or while utilizing your travel points, experts say.

According to the U.S. Travel Association (USTA), by the end of this year, 2.45 billion Americans will have traveled, with the forecast for 2025 predicting an increase to 2.65 billion. These travel numbers have been a boon to the U.S. economy, with the USTA reporting in its latest numbers that $1.2 trillion in direct spending supports the 15 million jobs created by the industry.

Travelers who want to fly and take vacations should expect to spend more and receive fewer perks next year, experts say.

“The average flyer is going to see higher prices,“ Robby Silk, the senior editor for aviation at Travel Weekly, told The Epoch Times. ”One of the reasons is that economy cabins are getting squeezed as airlines add more seats with extra legroom or first-class or premium economy. This includes taking out economy seats and making the remainder with smaller amounts of legroom, so they get the worst product.

Silk said some airline capacity is not growing as fast as they were a year ago.

“Some are also flying less to bring prices back in line, and some are dealing with airplane and engine delivery issues. For instance, Spirit will be down 20 percent in capacity next quarter,” Silk said.

Southwest Airlines announced earlier this year that it will begin offering premium seating on all its flights, abandoning its open-seating strategy. The company will add extra-legroom premium seats, which will cost travelers more and further limit the availability of seats offering basic fares.

“Moving to assigned seating and offering premium legroom options will be a transformational change that cuts across almost all aspects of the company,” said Bob Jordan, president, CEO, and vice chairman of the board, in a July press release.

“Although our unique open-seating model has been a part of Southwest Airlines since our inception, our thoughtful and extensive research makes it clear this is the right choice—at the right time—for our customers, our people, and our shareholders.”

Travel Points Are Devaluing

According to a June report from Investopedia, airline business class travelers, while representing only 12 percent of passengers, account for as much as 75 percent of an air carrier’s profits. While savvy travelers leverage points earned through flights or credit cards to upgrade to those higher flight classes, they are also finding themselves increasingly squeezed.

“It’s getting more difficult to use points successfully for bucket list trips and more expensive to get them, and I don’t expect that to change,” said Clint Henderson, general manager of The Points Guy, a travel blog that advises travelers on how to acquire and use the travel points they’ve accumulated from airlines, credit cards, and hotel loyalty programs.

“There’s a saying in the frequent flyer community: earn them and burn them. The points devalue over time. The airlines are giving out so many miles now with sign-up bonuses. But inflation has really hit the price of business-class tickets, and they don’t go as far,” Henderson told The Epoch Times.

And those points can disappear quickly. According to The Points Guy, the number needed for a business-class flight can vary depending on the airline and route, ranging between 60,000 and 100,000 points.

“I do think that points will continue to lose value in 2025, and elite status is going to be harder to earn,” said Henderson. “Airlines will sell more of their first-class and business cabins. It’s a money maker. They still want you to use points for that, but I think in inefficient ways.”

Airport Lounges Get Crowded and Harder to Access

Another emerging traveler squeeze is the number of airlines and credit card companies that are increasingly limiting who has access to their travel lounges at airports.

Jamie Biesiada, co-host of Travel Weekly’s popular travel podcast “Trade Secrets,” told The Epoch Times that many lounges are adding more restrictions because they let too many people have access.

“Post-COVID is when we saw the worst in lounge crowding when everyone started traveling again. I found lines at American Express Centurion lounges, and I couldn’t even get in, in some cases. But they’ve done a better job of expanding popular lounges, and American Express has doubled the size of some of its lounges,” Biesiada said.

Henderson agreed that something had to change.

“More people than ever have access to airline lounges, though there is an arms race, and you see a lot of lounge crowding. Airlines are making moves and limiting visits and adding QR code waiting lists and the total number of guests allowed. They’re aware that this is a problem,” Henderson said.

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