Santa Claus is being good to travelers this year.
Holiday airfares are lower than they were in the last couple of years, and some prime destinations like Cancún have more flights, more hotel rooms and better deals, especially for Christmastime vacationers.
A new treaty between the U.S. and Mexico that took effect in August allowed airlines to add more flights, including several that are starting in December.
Another hot destination: Iceland, which has seen a wave of tourism fostered by new airline options. Wow air, a 2012 startup that flies to Reykjavik from five U.S. cities, and Icelandair, which allows free stopovers up to seven nights between the U.S. and Europe, are tapping into interest in destinations off the beaten tourism paths. Kayak says searches for holiday trips to Reykjavik have jumped 165% this year, the biggest leap of any destination in its top 100 world-wide.
Thanksgiving ticket prices are down 2.6% this year compared with tickets sold at the same time for the same travel dates in 2015, according to Airlines Reporting Corp., which processes tickets for online and traditional travel agencies. Christmas trips have been running 3.3% cheaper on average, ARC says, at an average price of $587, down from $607 last year.
“It’s not a dramatic decrease but overall air travel continues to be a really good value,” says Chuck Thackston, ARC’s managing director of enterprise information.
Some routes have seen very impressive price cuts compared with holiday prices last year. Expedia says ticket prices for trips between Seattle and Las Vegas for Thanksgiving are 35% cheaper than last year, based on searches consumers have done on its sites. Newark-Orlando tickets are 20% less expensive this year; and the same for New York-Cancún tickets.
For Christmas, even bigger Cancún savings kick in. Tickets from Los Angles to Cancún are 25% lower this year; Chicago-Cancun has been 30% cheaper and New York-Cancún is down 40%, Expedia says. The number of trips booked is up this year as people take advantage of lower prices.
Delta, American, Southwest, Mexican discount carrier Interjet and others are pumping new flights into Cancún from the U.S. Some of the new service starts in December, including Southwest flights from Los Angeles to Cancún on Dec. 4 and new Delta flights between New York Kennedy and Cancún as well as Los Angles International and Cancún on Dec. 17.
Cancun’s airport has been expanding terminals and plans an additional terminal to open next year. Several big hotels have recently opened and more are under construction in Mexico’s largest tourist destination.
Good deals can still be had at resorts. The five-star Secrets The Vine Cancún all-inclusive resort had rooms available this week for $426 for a Dec. 23 four-night stay. The Westin Resort and Spa was listed on Hotels.com at $372 a night for those dates.
The strong value of the dollar has continued to make European travel a bargain, especially to England. A room at the Le Meridien Piccadilly in London for four nights staring Dec. 23 is only $207 a night, according to Hotels.com.
For the past couple of years U.S. airfares have trended lower. Many large and even some smaller cities have seen growing competition from low-cost carriers that have expanded aggressively with low fuel prices. These carriers have been able to offer lower prices in part because they collect billions of dollars in bag, seat, ticket-change and service fees, which now account for more than 20% of revenue for many.
The Transportation Department’s latest data on fares shows average round-trip domestic ticket prices down 8.7% to $353 in the second quarter this year compared with the same months of 2015.
This year is different than most as the falling prices are carrying through to the holidays. Average ticket prices for flights into Los Angeles International Airport are down 5% for both Thanksgiving and Christmas, ARC says. Seattle and San Francisco are down 7% for Thanksgiving; Miami and Fort Lauderdale, Fla., are down 7% for Christmas. Cancún from all U.S. Cities is down 4% for Thanksgiving but 11% for travel over Christmas.
Airfare research company Hopper says prices for Thanksgiving trips start high and stay high since travel is so compressed into a few premium days. “It doesn’t really matter how far ahead you buy,” says Patrick Scurry, Hopper’s chief data scientist.
But with Christmas and New Year’s, travel is more disperse, especially this year when both fall on a weekend. Prices start lower, rise gradually then spike the last 10 days before departure. “It’s often better to book your Christmas flights first before your Thanksgiving plans,” says Mr. Scurry.
He says airlines are embracing the Cyber Monday retail strategy and travelers can expect attractive sales right after Thanksgiving. These often entice people to take trips in slower periods in January and February.
One new trend this year, travel companies say, is more focus on New Year’s travel. For some, New Year’s has become the best escape after dealing with family over Thanksgiving and Christmas. And New Year’s Eve has become a destination event for many cities with big-name concerts and other attractions.
“It’s become more of a thing,” says Kayak Vice President David Solomito. Kayak says searches for trips over New Year’s are up 35% compared with last year and 54% compared with 2013.
Nashville pops onto Kayak’s list of top trending cities for New Year’s Eve, after Reykjavik and Sydney, Australia. Searches for New Year’s trips to Nashville have doubled since last year, Kayak says.
Mr. Solomito says people may be coming to a free concert headlined by Keith Urban. Last year’s event drew 150,000 people, according to the Nashville Convention and Visitors Corp., and this year’s concert has been moved to a larger venue in a downtown park.