On June 10, the US government removed a restriction that travelers flying in from other countries needed to show a negative COVID-19 test to enter the country.  This restriction was a potential barrier not only to foreign tourists, but to US citizens who were hesitant to travel abroad and risk getting stuck in a foreign country.  In today‚Äôs Insight Flash, we look at spend growth on international airlines for US travelers and US airlines for UK travelers to determine the extent to which the policy change has boosted foreign travel. 

Among flyers living in the US, this change in policy led to a sharp divergence in trends for US-based versus internationally-based airlines.  Almost a week after the announcement on 6/16, spend on international travel had accelerated +5% to 83% y/y growth versus 78% at the beginning of the month (on a rolling 7-day basis to control for day of week effects).  However, spend on domestic travel had only grown 15%, just over half of the 28% growth rate from June 1, a -13% deceleration.  And some of the US airline spend may have been from travelers taking international flights booked through domestic carriers. 

Airline Spend Growth Among US-Domiciled Flyers

Note:  Captures when flights are booked and charged to payments cards, not when flight is taken

In the UK, there was an acceleration in travel spend growth after the announcement for both US and non-US carriers, which could be due to UK travelers using European airlines to enter the US, or unrelated factors.  However, the fact that spend growth for travel on US carriers, which is likely predominantly travel into the US, grew so much faster than spend for other carriers, suggests that there was also an increase in UK flyers travelling into the US.  Spend growth on US carriers for the seven days ending June 16 was 1.5x the rate of spend growth on June 1, versus being slightly down from June 1 levels (though up from June 9 levels) on non-US carriers. 

Airline Spend Growth Among UK-Domiciled Flyers

Note:  Captures when flights are booked and charged to payments cards, not when flight is taken

Where were US travelers flying?  Looking at the increase in spend growth for the seven days ending 6/17/22 versus the previous week, the top acceleration was for Air Canada, Philippine Airlines, Air France, and Icelandair.  Delta, which has a strong partnership with Air France-KLM and newly added Virgin Atlantic, was the only US airline to have positive acceleration in spend growth.   

US Spend Growth Acceleration by Airline

Note:  Acceleration in y/y growth from 7 Days Ended 6/17/2022 vs. 6/10/2022; captures when flights are booked and charged to payments cards, not when flight is taken