As the Russian taking over of Ukraine continues with no end in vision, how are Americans’ European evacuation plans being affected? It depends on whom you ask, but overall the answer seems to be somewhere between “not at all” and “slightly.”
Travel app Hopper distinguished a drop in flight looking for the Continent as early as February, along with an outstanding rise in airfares. Yet one travel guide said she’s seen no decrease in enthusiasm for European bookings or departures from her clients.
Jennifer Griscavage, an organizer of Runway Travel, an independent affiliate of McLean, Virginia-based McCabe World Travel, has been “very busy booking European travel” for all the war in Ukraine.
“The biggest impact we have seen is concern about traveling to any of the countries that share a border with Russia or Ukraine,” she said, in particular by clients booking a “bucket list” trip to the Russian port city of St. Petersburg as part of a Baltic Sea cruise.
“Unfortunately, cruise lines have had to cancel stops in St. Petersburg [so] most of our clients have moved these sailings to 2023,” she added.
That report isn’t great for stations near the war zone or bordering either Russia or Ukraine, as they had already suffered a great drop in overall visitors due to the pandemic, on the report to the European Travel Commission in Brussels. The Czech Republic saw an 81% drop in arrivals last year compared to 2019, followed by Finland, at -80%, Latvia at -78%, Estonia at -77%, Slovakia at -76%, and Lithuania at -74%, said the ETC.
Yet, the picture may be dazzling for destinations farther west. Despite “some mild concerns,” Europe is “still a go” for Runway Travel’s mostly well-heeled clients. “Italy, Greece, and France, in particular, have been very popular,” Griscavage said.
Audrey Hendley, president of Global Travel and Lifestyle Services at American Express, said while the impacted areas aren’t major destinations for customers, the company is matching card member donations, donated $1 million to relief efforts, and provided 1 million hotel room nights to support refugees.
“These are not large destinations for us,” she said. “However, every destination is important; every customer is important.”
Investigators at Hopper report an impact on exploring demand, bookings, and airfares all around Europe in the weeks leading up to, and following, Russia’s Feb. 27 assault on Ukraine.
According to their information “How is the Russia-Ukraine War Impacting Travel?,” flight searches for trips to Europe (apart from Russia and Ukraine) are 9% below expected levels given the pent-up demand for travel after the omicron variant surge. Booking volume had started to pick up in January from the mid of February as omicron subsided but has now returned to levels seen at the starting of the year.
“That’s not necessarily a strong decline,” said Adit Damodaran, rates analyst at Hopper.
“It’s just that [searches] had been increasing at a certain rate, but now it’s kind of tapered and leveled off below where we would have expected,” Damodaran said.
The conquering seems to have had less of an impact on Hopper’s existing transatlantic bookings than Covid did. Whereas about 20% of the app’s customers who’d purchased “cancel for any reason” protection with their Europe trips exercised their right for a return during the pandemic, just 15% have done so during the current crisis in Ukraine.
“It could be that a lot of our travelers are going to Western Europe,” Damodaran said. “If they’ve already booked that trip they might just figure, ‘I might as well just continue with it.’
“But those just considering booking are more hesitant,” he added. “They’re not going make a new booking to Europe.”
Travelers not taking planned European trips are postponing rather than booking alternate destinations, said Damodaran. “In a more normal year, Europe would be about 30%, or almost one-third, of our bookings [and] it’s now about 15%,” he said.
Flight analysts and actual bookings may decrease but airfares are high, Hopper found. Fares to Europe are 16% higher every month. That might seem like a lot, but, according to Damodaran, the rate of jet fuel rose 70% in 2021 in the wake of the pandemic — and then a 30% gain in the first three months of this year alone, going to $2.86 a gallon from $2.20, according to the U.S. Energy Information Administration.
“The magnitude of what we’ve seen just since the beginning of 2022 has been huge,” he said. “We expect that increase in jet fuel prices to show up in airfare.”
To wit, domestic U.S. airfares are high at 36% since Jan. 1.
“We usually expect that to be closer to 7% to 8% in a more normal year like 2019,” Damodaran said. Carriers usually eat some of the cost of more expensive jet fuel “because it eventually affects travelers’ willingness to pay.”
Moscow’s invasion of Ukraine and the outcome on global energy markets could make an already bad state of affairs worse.
