Monthly Travel Indicators Summary - October 2024

Executive Summary Domestic

Forecast (updated February, June & October)

• Domestic visitor spending in California for 2024 is forecast to be flat with 2023 spending due to normalizing leisure travel demand and increasing rates of outbound travel.
• According to the Tourism Economics October forecast prepared for Visit California, the state is forecast to earn $155.2 billion in travel spending in 2024, 3% higher than 2023.
• Domestic leisure spending is forecast to be $128 billion, flat relative to 2023. Domestic business spending, however, is expected to grow by 1%.
• Total domestic visitor spending is forecast to grow by 3% in 2025.

Macroeconomic

• October economic indicators were heavily caveated by economists.Inflation increased slightly, primarily due to housing costs, while job creation was unusually low due to weather events and ongoing labor strikes. However, consensus among economists was the economy remained on solid ground.
• Inflation ticked up slightly in October to 2.6%. The national average retail price for a gallon of gas was $3.26 (vs. $3.34 the previous month). The California equivalent price was $4.51 (compared to $4.57 the previous month).
• Approximately 12,000 jobs were added to the economy, an unexpectedly small number which was likely affected by the Boeing strike and impacts from hurricanes Milton and Irene. The unemployment rate was 4.1% (same as September).
• The University of Michigan tracked U.S. consumer sentiment on the economy to 68.9, on par with the measurement in September.

Consumer Sentiment

• Concerns related to travel costs and the economy (recorded before the election) appeared to ease slightly this month while excitement for travel (including outbound international travel) remained highly positive.
• Consumer tracking from Future Partners showed that the cost of travel continues to be a top barrier/deterrent to travel with a third (33%) of U.S. travelers saying travel is too expensive right now. Measures for both the U.S. and California have declined slightly.
• A third of American travelers (33%) felt optimistic about their current financial situation relative to a year ago (California residents were more optimistic at 41%. They were more confident about their future economic situation (48% of the U.S. and 52% of California residents expect more positive).
• American travelers were excited about future travel, with 87% of U.S. travelers (and 91% of California residents) saying they were excited about leisure travel in the next 12 months. The figured declined slightly from prior month.
• Four out of ten American travelers (41%) and more than half of California travelers (53%) said they were considering international leisure travel in the next 12 months. The U.S. measure reached a peak high in October.

Lodging

• Lodging demand experienced normalized growth of 1% on a year-over-year basis with travel the week before Halloween particularly strong across the entire state. Group demand was softer this month while short-term vacation rentals continued to show strong pricing power relative to the hotel sector.
• Hotel room demand in the state for the month grew 1% year over year. Looking at the year-to-date figures, room demand for the state was flat year over year and down 7% from 2019 through October.
• California’s monthly occupancy rate was 71% (+1% YOY). The state's ADR was $192 (-1% YOY), and RevPAR was $136 (flat YOY). The week ending Oct. 26 (the week prior to Halloween) had a particularly strong performance with Occupancy at +6% and RevPAR at +7% will all 12 tourism regions posting occupancy growth.
• Group room demand in the state declined 5% relative to October 2023. Gold Country and San Diego were the only two tourism regions to record an increase in demand for the month.
• The occupancy rate for short-term vacation rentals in the state was 53%, flat year over year, but the ADR was up 11%, driving an 11% increase in RevPAR year over year.

Airlift

• Passenger traffic measured by TSA checkpoints continued to show year-over-year growth.
• Seventy-six million passengers were screened nationally at TSA checkpoints for the month (+1% YOY).  Nearly 10 million travelers were screened at California airports (+1% YOY).
• There were 10.1 million non-stop domestic seats to California destinations for the month (+4% YOY).

Executive Summary International

Forecast (updated February, June & October)

• International travel spending in California is forecast to nearly fully recover in 2024 (98% of 2019 spending), driven by Mexico, Canada and key overseas markets like Australia and India.
• According to the Tourism Economics October forecast prepared for Visit California, international visitor spending in the state will grow by 22% in 2024 and reach $27.6 billion and grow by another 22% in 2025.
• North American neighbors Mexico and Canada are forecast to be California’s largest spending markets, with visitor spending of $4.9 billion and $3.8 billion, respectively.
• China is forecast to be the most important overseas market, with visitor spending of $2.5 billion in 2024, 94% of 2019 spending levels.

Consumer Sentiment

• International leisure travel intent averaged across California’s 13 priority markets remained consistent with prior months, as did the cost of travel as a barrier, although rates were declining somewhat from prior year.
• On average, across California’s priority markets, 44% of international consumers said they were planning international leisure travel (anywhere) in the next 12 months, up from 41% a year ago and 37% two years ago for the comparable month.
• Travel prices are the primary barrier to travel (43% citing travel price, comparable to prior month and previous year). South Korea (52%) Canada (49%), and France (49%) were the markets with consumers most likely to indicate prices were a barrier to travel but rates have declined somewhat from 2023.
• Safety and health concerns remained secondary barriers in the Asia Pacific, India, and Middle East markets.

Airlift/Arrivals

• International airlift and non-resident arrivals to California from Visit California’s 13 priority markets continued to grow in October on a year-over-year basis. China arrivals recovery improved notably this fall, likely fueled by Golden Week holiday travel.
• For the month, 1.5 million non-stop seats to California were available from Visit California’s 13 priority markets, a 4% year-over-year growth rate. The U.K. and Japan had the most non-stop seats to California for the month among the overseas markets. India has seen the largest increase in airlift relative to 2019 (+114%).
• Non-resident arrivals through California’s ports of entry were up 5% yearly but down 16% from 2019 levels for the 13 priority markets.
• China recovered to 72% of prepandemic arrivals for the month, the second month in a row of recovery above the 70% mark.