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Inside Emerging Travel Trends of 2024: ETFs to Benefit
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The global travel industry, battered by the COVID-19 pandemic, has demonstrated resilience over the past few years. While experts had initially predicted that a full recovery might not happen until 2024 or later, 2023 saw a strong resurgence in international travel.
The year 2024 is expected to be a milestone for global passenger traffic recovery, surpassing the numbers seen in 2019, per Airport Council International. According to the UN World Tourism Organization (UNWTO), international arrivals reached 85% of pre-pandemic levels in the second quarter of 2023 and 90% in July. This positive trend is expected to continue into 2024, with many regions surpassing the 2019 levels, as quoted on ITIJ.com.
Sustainability and Technological Advancements to Rule
Sustainability is becoming a crucial part of the travel industry. There is a substantial emphasis on decarbonization, with goals for zero-emission aircraft and sustainable aviation fuel technologies. Consumers increasingly prioritize sustainable travel, with a Booking.com survey revealing that 81% consider it important, as quoted on ITIJ.com.
Businesses in the travel sector are increasing sustainability initiatives to lower carbon footprints. In a recent poll, 37% of respondents prioritized sustainability, and 45% plan to invest in sustainability initiatives. KraneShares Global Carbon Offset Strategy ETF can benefit from this trend.
Moreover, the deployment of digital transformation, artificial intelligence (AI), and data analytics will continue to reshape the travel experience, enhancing the overall sustainability of the industry. ETFMG Travel Tech ETF (AWAY - Free Report) is thus expected to be a great pick.
Airlines to Fly High
Airline companies suffered significantly during the pandemic, which put a halt on travel. This resulted in major U.S. airline companies experiencing substantial losses in both 2020 and 2021. However, the subsequent year saw an increase in air travel, but 2023 emerged as a pivotal year for the airline industry.
In fact, the International Air Transport Association (IATA) anticipates a solid surge in traveler numbers and revenues for airlines in 2024. The sector is projected to achieve a net profit of $25.7 billion, with a 2.7% net profit margin, as quoted on CNBC. Hence, investors should keep a tab on airlines ETF U.S. Global Jets ETF (JETS - Free Report) .
Increase in Global Hotel Rates
Hotel rates are expected to rise by 6.8% on average in 2024, as quoted on BCD Travel. This increase is attributed to demand, which continues to outstrip the supply of available hotel rooms. The industry is witnessing a change in hoteliers' priorities, focusing more on average daily rates and revenue per available room instead of striving for maximum occupancy. This change is partly a response to high inflation in many countries, affecting operating costs. AdvisorShares Hotel ETF (BEDZ - Free Report) and Defiance Hotel Airline and Cruise ETF (CRUZ - Free Report) may be beneficiaries of this trend.
Recovery in Business Travel
Global business travel is forecast to fully recover by 2024, with spending expected to reach $1.48 trillion, slightly above the pre-pandemic levels of 2019, as quoted on Global Business Travel Association. This recovery, however, has its share of risks, including COVID-related disruptions, supply-chain strains, labor shortages, and increased costs. The recovery rate varies across regions, with North America leading the way??????. Thus, along with BEDZ, JETS and CRUZ, ALPS Global Travel Beneficiaries ETF (JRNY - Free Report) is also expected to benefit.
(Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.)
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Inside Emerging Travel Trends of 2024: ETFs to Benefit
The global travel industry, battered by the COVID-19 pandemic, has demonstrated resilience over the past few years. While experts had initially predicted that a full recovery might not happen until 2024 or later, 2023 saw a strong resurgence in international travel.
The year 2024 is expected to be a milestone for global passenger traffic recovery, surpassing the numbers seen in 2019, per Airport Council International. According to the UN World Tourism Organization (UNWTO), international arrivals reached 85% of pre-pandemic levels in the second quarter of 2023 and 90% in July. This positive trend is expected to continue into 2024, with many regions surpassing the 2019 levels, as quoted on ITIJ.com.
Sustainability and Technological Advancements to Rule
Sustainability is becoming a crucial part of the travel industry. There is a substantial emphasis on decarbonization, with goals for zero-emission aircraft and sustainable aviation fuel technologies. Consumers increasingly prioritize sustainable travel, with a Booking.com survey revealing that 81% consider it important, as quoted on ITIJ.com.
Businesses in the travel sector are increasing sustainability initiatives to lower carbon footprints. In a recent poll, 37% of respondents prioritized sustainability, and 45% plan to invest in sustainability initiatives. KraneShares Global Carbon Offset Strategy ETF can benefit from this trend.
Moreover, the deployment of digital transformation, artificial intelligence (AI), and data analytics will continue to reshape the travel experience, enhancing the overall sustainability of the industry. ETFMG Travel Tech ETF (AWAY - Free Report) is thus expected to be a great pick.
Airlines to Fly High
Airline companies suffered significantly during the pandemic, which put a halt on travel. This resulted in major U.S. airline companies experiencing substantial losses in both 2020 and 2021. However, the subsequent year saw an increase in air travel, but 2023 emerged as a pivotal year for the airline industry.
In fact, the International Air Transport Association (IATA) anticipates a solid surge in traveler numbers and revenues for airlines in 2024. The sector is projected to achieve a net profit of $25.7 billion, with a 2.7% net profit margin, as quoted on CNBC. Hence, investors should keep a tab on airlines ETF U.S. Global Jets ETF (JETS - Free Report) .
Increase in Global Hotel Rates
Hotel rates are expected to rise by 6.8% on average in 2024, as quoted on BCD Travel. This increase is attributed to demand, which continues to outstrip the supply of available hotel rooms. The industry is witnessing a change in hoteliers' priorities, focusing more on average daily rates and revenue per available room instead of striving for maximum occupancy. This change is partly a response to high inflation in many countries, affecting operating costs. AdvisorShares Hotel ETF (BEDZ - Free Report) and Defiance Hotel Airline and Cruise ETF (CRUZ - Free Report) may be beneficiaries of this trend.
Recovery in Business Travel
Global business travel is forecast to fully recover by 2024, with spending expected to reach $1.48 trillion, slightly above the pre-pandemic levels of 2019, as quoted on Global Business Travel Association. This recovery, however, has its share of risks, including COVID-related disruptions, supply-chain strains, labor shortages, and increased costs. The recovery rate varies across regions, with North America leading the way??????. Thus, along with BEDZ, JETS and CRUZ, ALPS Global Travel Beneficiaries ETF (JRNY - Free Report) is also expected to benefit.
(Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.)