Monthly Travel Indicators Summary - September 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 $128B, 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

• The overall inflation rate and subset of energy and gas prices remained under control, declining again this month at the national level. Jobs, unemployment, and consumer confidence indicators continued to signal a strong economy with no recession in sight.
• Inflation remained below the 3% mark declining to 2.4% in September. The national average retail price for a gallon of gas was $3.34 (vs. $3.51 the previous month). The California equivalent price was $4.57 (up slightly compared to $4.45 the preceding month).
• Approximately 254,000 jobs were added to the economy, an increase from last month’s 159,000 jobs, which was adjusted upward. The unemployment rate was 4.1% (compared to 4.2% in August).
• The University of Michigan tracked U.S. consumer sentiment on the economy to 69, up slightly from the measurement in August.

Consumer Sentiment

• Travel consumers continued to be optimistic about their financial situation and travel excitement/intent. On the downside, U.S. travelers are expressing intent to travel internationally at higher rates.
• Consumer tracking from Future Partners showed that the cost of travel continues to be a top barrier/deterrent to travel with more than a third (34%) of U.S. travelers saying travel is too expensive right now.
• A third of American travelers (33%) felt optimistic about their current financial situation relative to a year ago (California residents were more optimistic at 37%, but down from 41% prior month). However, they were more confident about their future economic situation (48% of the U.S. and 51% of California residents expect more positive).
• American travelers were excited about future travel, with 90% of U.S. travelers (and 90% of California residents) saying they were excited about leisure travel in the next 12 months. The U.S. figure was a record for Future Partners’ tracking. A comparable 90% (U.S.) and 92% (California)of travel consumers have 1+ leisure trips planned in the next 12 months.
• Four out of ten American travelers (40%) and nearly half of California travelers (46%) said they were considering international leisure travel in the next 12 months. The U.S. measure reached another peak high in September.

Lodging

• Room demand continued a trend reaching five months of continued growth of 1 to 2% each month. However, demand remained flat on a year-to-date comparison. Group demand was particularly strong in September.
• 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 8% from 2019 through September.
• California’s monthly occupancy rate was 71% (+1 YOY). The state's ADR was $195 (flat YOY), and RevPAR was $138 (flat YOY). The week ending September 21 had a particularly strong performance with RevPAR at +11% for the state driven by the San Francisco Bay Area region with 37% RevPAR growth. (This was a favorable comparison related to the Dreamforce conference which fell on a different week relative to 2023).
• Group room demand in the state was up a robust 7% relative to September 2023. Orange County saw group room demand increase by 35% year over year for the month.
• The occupancy rate for short-term vacation rentals in the state was 51%, down 4% year over year, but ADRs were up 11%, leading to a +6% increase in RevPAR year over year.

Airlift

• Passenger traffic measured by TSA checkpoints continued to show year-over-year growth.
• Seventy-two million passengers were screened nationally at TSA checkpoints for the month (+3% YOY). Nine million travelers were screened at California airports (+1 YOY).
• There were 9.6 million non-stop domestic seats to California destinations for the month (+2% 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.
• On average, across California’s priority markets, 43% of international consumers said they were planning international leisure travel (anywhere) in the next 12 months, up from 41% a year ago and 35% two years ago for the comparable month.
• Travel prices are the primary barrier to travel (43% citing travel price, down from 45% prior month). Canada (51%) and South Korea (51%) were the markets with consumers most likely to indicate prices were a barrier to travel. Japanese and Chinese consumers were more likely to cite the price of travel as barrier compared to a year ago.
• 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 August on a year-over-year basis. After months of little change in the recovery metrics, arrivals from China recovered to 76% of 2019 levels for the month.
• 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 (+103%).
• Non-resident arrivals through California’s ports of entry were up 7% yearly but down 13% from 2019 levels for the 13 priority markets.
• China recovered to 76% of prepandemic arrivals for the month, a significant gain from the prior month (59%).