High prices force tourists to change plans

The price of airfare and package tours continues to rise in Canada. Many tourists have changed their plans or destinations in order to reduce their expenses.

This is the case of Raffy Gutman, who travels several times a year from St. Louis in Toronto for work and to see his family.

These days, these thefts are hurting his wallet.

Traveling from the United States to Europe is less expensive than traveling to Canada, although the flights are much longer. It’s so expensive and I don’t understand why.

Right now, the price of plane tickets for round-trip flights from Toronto to St. Louis with his family of four would cost around $4,000. He has halved the number of visits he will make to the Queen City.

Dana Detelich, a resident of Raleigh, in North Carolina, wanted to visit several regions of Canada with his family for the first time. The cost of a single trip to Toronto would have been way beyond his budget.

The family then decided to make the trip by car; which will have cost a quarter of the price. Once we arrived in Toronto, plans changed.

We wanted to visit Quebec and other provinces, but the prices of flights and gas are exorbitant. We will have to settle for and enjoy Toronto.

According to the most recent consumer price index (New window) from Statistics Canada, prices for package tours increased by 6.9% and those of air transportation by 4.5%, between May 2023 and May 2024.

Travelers change their habits

People are aware of the inflation that is affecting the airline industry. Amra Durakovic, head of communications at travel agency Flight Centre Travel Group, sees people adjusting their plans accordingly.

According to a recent survey that the agency conducted with YouGova global online research data and analytics technology group, about two-thirds of Canadians surveyed plan to travel in the next 12 months. More than 80% of them are looking for deals and ways to save.

The survey also found that typically less desirable destinations have gained popularity, including the cities of Boston and Nashville, as well as the states of Colorado and Arizona.

Amra Durakovic also notes that people increasingly tend to plan their trips by taking care to book their plane tickets at least six months in advance.

Buying tickets in advance, traveling to new destinations, looking for deals and exclusive packages are all strategies used by Canadians right now to optimize their budget.

Carole Doré, co-owner of the Voyages Rideau agency in Ottawa, agrees.

Some of its customers avoid traveling during peak season and favor certain less frequented regions.

People who can take their children out of school a little before or after the holidays find attractive pricesshe says.

Carole Doré notes that those who want to travel to Jamaica or Aruba tend to prefer the Dominican Republic, because flights to this destination are cheaper.

Tourism industry hit

Although Canada has been attracting more tourists since the pandemic, the levels have not yet reached those of 2019, says Frédéric Dimanche, director of the School of Hospitality and Tourism Management at Metropolitan University of Toronto.

The cost of flights is a constraint, he said, as are the prices of hotels and restaurants. He said that would discourage some tourists from visiting Canada.

We see that American tourists have not returned in such large numbers. We also had Chinese tourism in Canada which was quite strong in 2018 and 2019. And that has not resumed.

He notes that the quality of services offered could also be affected. According to Mr. Dimanche, the industry lost a lot of qualified personnel at the height of the pandemic. Employers are still struggling to fill positions.

It may create discontent and a decrease in the competitiveness of the country or destinations if we fail to provide services at the level of quality that tourists expect.

The price of flights, a central factor

The travel craze is always strong during the summer period, but in this case, supply is not meeting demand, according to Karl Moore, an airline analyst and management professor at McGill University.

He supports his point by citing the bankruptcy of airlines, such as Lynx, which ended its activities earlier this year.

It is not easy for small airlines to survive in this markethe said, which allows larger companies to raise their prices and profits.

The salaries of employees of these companies have also increased, as has the cost of fuel. Companies must then increase prices to succeed in the current contextMr. Moore added.

When operating costs skyrocket, airlines have no choice. These increases are automatically reflected in passenger bills.

The expert notes that consumers will have to expect high prices in Canada for the coming years.