After encountering some Q3 turbulence, both American and Southwest Airlines see clearer skies ahead

The trend: While travel bookings in October and December look strong, the presidential election may produce some short-term turbulence in November.

• “We expect there to be some distraction around Halloween and the election,” said American Airlines CEO Robert Isom during the company’s earnings call, before adding that demand in October and December, as well as around Thanksgiving, is “very strong.” He continued to say that despite the blips, “People want to travel, and we're very optimistic about how the bookings look for the fourth quarter.”
• Southwest Airlines expects Q4 revenues to grow between 3.5% year over year (YoY) and 5.5% YoY as “travel demand remains healthy and bookings-to-date for the holiday season are strong, demonstrating the continued resilience of the leisure travel market,” the company wrote.

Why it matters: The two airlines’ comments, which dovetail with similar comments by executives at Delta and United, add to the growing evidence that consumers continue to prioritize travel.

• Roughly half of Americans (49%) expect to spend money on flights and hotels during the holiday season, spending an average of $2,330, per a survey by NerdWallet and The Harris Poll. That’s up 19.7% from last year’s average spending of $1,947.
• But that doesn’t mean that they aren’t focused on value; 69% of holiday travelers who plan to fly say price is a bigger priority to them than flying with their favorite airline, per a survey by The Points Guy and The Harris Poll.

Our take: We expect US digital travel sales to grow 8.5% YoY this year, which reflects the growing disconnect between consumer sentiment and consumer spending patterns. Even as sentiment remains well below historic norms, consumers are willing to spend on travel this holiday season.

Go further: Read our Infopack: Travel 2024.