This Independence Day weekend is set to break travel records, with AAA projecting that 50.7 million Americans will journey 50 miles or more from home. This marks a significant increase of 2.1 million travelers compared to last year and surpasses the previous record of 49 million set in 2019.
Paula Twidale, Senior Vice President of AAA Travel, noted, “We’ve never projected travel numbers this high for Independence Day weekend. Despite limited inventory and some prices being 50% higher, consumers are not cutting back on travel this summer. Many heeded our advice and booked early, another sign of strong travel demand.”
A major factor contributing to this surge in travel is the lower gas prices. This summer, gas prices are significantly lower than they were a year ago. On July 4th, 2022, the national average for a gallon of regular gas was $4.80. This year, the average has hovered around $3.50 to $3.60, thanks to the lower cost of oil. As a result, AAA expects 43.2 million people to drive to their destinations, a 2.4% increase over 2022 and 4% higher than 2019.
Air travel is also expected to set a new record, with AAA projecting 4.17 million Americans will fly over the holiday weekend. This represents an 11.2% increase over 2022 and a 6.6% increase over 2019. The previous record for air travel during the July 4th weekend was 3.91 million travelers in 2019. This year, air travelers make up 8.2% of the overall holiday forecast, the highest percentage in nearly two decades.
Other modes of transportation, including buses, cruises, and trains, are also seeing a rise in popularity. AAA expects 3.36 million people to travel by these means over the long weekend, a 24% increase over last year. However, this number is not expected to surpass the 2019 total of 3.54 million.
INRIX, a provider of transportation data and insights, predicts that Friday, June 30, will be the busiest day on the roads during the Independence Day holiday weekend. Average travel times are expected to be up nearly 30% over normal. Major metropolitan areas like Boston, Seattle, and Washington, DC, are expected to experience the worst traffic. INRIX recommends traveling in the morning or after 6 p.m. to avoid the heaviest congestion.
Bob Pishue, a transportation analyst at INRIX, advised, “With record-breaking travelers expected on the road this holiday weekend, drivers should prepare for above-average delays to their favorite destinations. Using traffic apps, local DOT notifications, and 511 services are key to minimizing holiday travel traffic frustrations this Independence Day.”
Travel demand has been steadily increasing since 2020, and this summer is poised to be one for the record books. Air travel is seeing the biggest spike despite high ticket prices, with passengers paying 40% to 50% more for flights compared to last year. Many airlines are responding to this demand by hiring more staff and replacing smaller regional planes with larger ones to increase capacity. However, challenges remain, including a shortage of air traffic controllers that has led to reduced service in and out of New York City area airports.
AAA advises travelers to avoid checking luggage to save time and money. Instead, travel with a carry-on bag to skip baggage claim and have flexibility if flights are delayed or canceled.
Hotel prices have increased slightly over 2022, but not by much. While domestic hotel bookings are about the same as last year, international hotel bookings are up 80% compared to 2022. The U.S. State Department is processing half a million passport applications a week, with routine service averaging 10-13 weeks. For those needing a passport quickly, RushMyPassport provides expedited services and discounts for AAA members.
Car rental shortages seen during the pandemic have improved, with inventory increasing steadily since last year. Newer models and electric vehicles have been added to fleets, and rental prices are down slightly from last year. Demand for international rental cars is up more than 80% compared to 2022. AAA reminds travelers that some countries require International Driving Permits, which can be obtained through AAA.
Cruising has returned to pre-pandemic numbers, with sold-out ships and advance bookings. Prices are about the same as 2022, with certain cruises slightly higher due to demand. Alaska cruises are particularly popular this time of year, and AAA booking data shows Caribbean cruises and European river cruises are top vacations in 2023. AAA recommends protecting travel investments with travel insurance, as demand for travel insurance is up more than 100% over last year.
The travel forecast for this holiday was developed by AAA in cooperation with S&P Global Market Intelligence. The forecast includes macroeconomic drivers such as employment, output, household net worth, asset prices, interest rates, housing market indicators, and variables related to travel and tourism, including gasoline prices, airline travel, and hotel stays. Historical travel volume estimates come from DK SHIFFLET’s TRAVEL PERFORMANCE/MonitorSM, which measures the travel behavior of U.S. residents.
The Independence Day holiday travel period is defined as the five-day period from Friday, June 30 to Tuesday, July 4. When the Fourth of July falls on a Wednesday, it is considered a six-day holiday period. Otherwise, it is a five-day window.
AAA, founded in 1902, has grown into one of North America’s largest membership organizations, providing roadside assistance, travel, discounts, financial, and insurance services to 62 million members across North America. S&P Global provides essential intelligence to help governments, businesses, and individuals make informed decisions. DK SHIFFLET offers comprehensive data on U.S. resident travel, and INRIX provides data and analytics on mobility.
Source: AAA, S&P Global, DK SHIFFLET, INRIX
