Q1 Consumer Travel Index & 2025 Outlook

As 2025 kicks off, travelers are already looking ahead to their 2025 vacations and getaways! This year travelers are looking to explore far-flung and exciting destinations around the world. Japan, Thailand, off-the-beaten-track destinations in Europe, and trips to the ends of the world are increasing in popularity in the new year. The Pacific Northwest and US beach towns are increasing in popularity for those travelers sticking closer to home, with destinations like Nantucket. Myrtle Beach and Hilton Head Island seeing demand surge for 2025.

With economic headwinds continuing to impact Americans, travelers are likely to remain price sensitive in 2025. Two-thirds of travelers say they price check multiple websites or apps before booking travel, looking for the best offers before they make a transaction. These savvy travelers are leveraging price monitoring tools and other AI and machine learning driven tools to find the best prices and value for their travel budget. 

Despite ongoing price consciousness, 76% of Americans plan to spend the same, or more, on travel in 2025 compared to last year.  Demand for both domestic and international travel is expected to continue growing in 2025 as younger generations, in particular, continue investing in travel and experiences over material things. 

Airfare 

6 Month Domestic Airfare Forecast

Domestic airfare surged in the second half of 2024, driven by both higher demand for travel over the holiday period and by the intentional cutbacks on capacity growth many airlines announced and instituted in late summer. 

Though prices have dropped into January as usual, airfare in 2025 is starting the year ~12% higher than in January of last year. Prices are expected to remain above 2023 and 2024 levels until mid-year at least. Though late spring and summer prices are currently forecasted to be above 2024 levels by double digits, it’s important to note that summer 2024 brought some of the lowest prices on record. When compared to spring and summer 2023, airfare is only expected to rise by ~4%. 

Airlines are currently scheduled to add just under 1 million seats to schedules this January compared to last year, amounting to a 1.2% increase in total seat capacity year over year. Though capacity is still growing in January compared to the previous year, the growth rate has slowed compared to previous years as airlines continue to cut back on capacity growth into the new year. 

International Airfare

Good news for travelers thinking of going abroad this year, airfare for long-haul international trips in the new year has dropped to Europe, South America, Asia, and Oceania. Prices to Africa and the Mideast remain in line with last year. Trips to the Caribbean and Mexico have increased in price compared to last year, with airfare 8% - 9% higher due to higher demand for warm weather trips during the winter months. Airlines have added capacity to all regions of the world but Europe this January, compared to schedules in January of 2024.

Jet fuel prices are averaging $2.19 per gallon this January, down 11% from this time last year. Prices in the last few weeks have returned to the lowest point since the pandemic driven spike in fuel prices in early 2022. Prices today are just slightly higher than pre-pandemic prices, averaging just over $2.00 per gallon. 

Source: U.S. Energy Information Administration (EIA)

Rental Cars

For those travelers looking to rent a car this January prices are much the same as last year, averaging $39 per day, just a $1 increase compared to this time last year.  

Top cities for rental pick ups are all in warm weather destinations from Florida and Texas to Nevada and California. Prices in these cities have surged compared to this time last year as demand for warm weather getaways in the new year is surging. Travelers are looking to get away to warmer climates this winter and renting cars for 4-6 days to accommodate their travel needs. 

Accommodations

National hotel prices are averaging $269 per night this January, down from just a few weeks ago during the busy and pricey holiday season. Most travelers looking ahead to hotel stays this year are searching for major US cities like New York, Las Vegas, and Miami beach. Those thinking of their next big international destination are looking to long-haul destinations like Bangkok, Tokyo, and Paris. January is a great month to book a trip or a staycation, given the lower than usual prices travelers can typically expect to find during this slow travel month.

2025 Trending Destinations 

After a busy holiday season of travel and time with friends and family, Americans are thinking about their travel plans for the new year and dreaming up the destinations they will visit. We’ve rounded up the top destinations American travelers are looking to book for 2025! 

Japan 

Japan has been the hottest international destination for American travelers for the last 3 years, but demand for trips to Tokyo, Osaka, Chitose, and more has not slowed down. Tokyo remains one of the highest demand destinations for international travel, and demand for transpacific trips to the island country continues to grow faster than all other international destinations. 

Europe, off the beaten path 

Europe is always a top region for American travelers, with tourist destinations like London, Paris and Rome capturing the largest volume of demand from international travelers. Despite this, demand for more off the beaten path European destinations has been building, with a range of unique destinations trending in popularity for 2025 trips. 

Adventure trips to the ends of the earth

Travelers are becoming more adventurous in 2025, looking to some of the most remote destinations in the world for their bucket list trips. Whether it’s a trip to the Arctic Circle in Norway or Finland to see the Aurora Borealis and the fjords or an adventure to the furthest points before Antarctica in Patagonia and Falkland Islands, travelers are packing for adventure in 2025.

Set Jetting to… 

Television and movies have always set trends for fashion and lifestyles, but now they’re also setting the trend for where travelers want to visit. The incredible popularity of many new television series have driven a phenomenon called “set jetting” to entirely new heights, with travelers eagerly booking trips to visit the destinations where their favorite films and shows are set. 

Yellowstone

The success of the Yellowstone TV series in the US has had a significant impact on where Americans are dreaming of taking their 2025 trips. Yellowstone, Montana is one of the top trending destinations for US travelers thinking about 2025 travel, even with a heavy price tag of $731 per round-trip ticket.  Yellowstone, Montana doesn’t just offer the wild west experience, it is also the gateway city to Yellowstone National Park, which offers Americans access to the Old Faithful geyser, the Grand Canyon of the Yellowstone and wildlife like elk and bison.

The White Lotus

The White Lotus has thrilled viewers over two seasons with more than just exciting plotlines.  The show has highlighted the incredible beauty and exciting experiences offered by trips to Hawaii and Sicily, where demand for leisure vacations has surged in the years following each season’s release. In 2025, the White Lotus will premiere season 3, highlighting a luxury travel experience in Thailand. Already, demand for trips to Thailand is growing as fans anticipate the new season and are eager to experience the destination for themselves. 

U.S Beach Towns 

Whether they’re dreaming up spring break trips or already planning for an epic summer vacation, Americans are increasingly looking to smaller domestic waterfront destinations for 2025 trips. Small islands like Nantucket and Martha’s Vineyard, off the coast of Massachusetts, are increasing in popularity alongside larger tourist destinations like Myrtle Beach and Hilton Head Island. Even as snow falls in the upper peninsula of Michigan, Traverse City, a northern Michigan lakeside resort town, is drawing increasing demand from American travelers for next year.

Pacific Northwest  

Cloudy and rainy days won’t deter Americans from the Pacific Northwest in 2025, as the stunning natural beauty of the region is driving even more travelers to visit both ports of the PNW: Seattle and Vancouver. 

Methodology 

Our Consumer Travel Index combines search data for every origin and destination in the United States, providing a near real-time estimate of overall airfare prices. This forecast represents the price of tickets available for purchase in a given month, not necessarily for travel in that month. Since travel prices are represented in both time dimensions -- time of purchase and time of travel -- it can be difficult to interpret price dynamics. We use the date of purchase because it reflects the price consumers are paying at a given point in time. Our domestic airfare forecast is calculated using 5+ years of historical pricing data, search demand and airline capacity data available and accurate as of the first week of January 2024. 

Trending destinations analysis uses 6 months of US origin flight searches, “shadow traffic,” ending December 11th, 2024 and 2023 respectively to understand the share of searches made for each destination, domestic and international. We analyze the destinations seeing the combined highest combination of high demand and high demand growth year over year to identify the trending destinations for domestic and international travelers.