Global travel spending is roaring back and will fully recover to pre-pandemic levels by the end of 2024, surpassing $2 trillion. The resurgence of international travel demand in Asia Pacific and strong leisure travel demand in North America and Europe will power this growth.
The road to recovery has been uneven across regions, however. Among the 14 travel markets we examined, three have yet to fully recover to pre-pandemic levels: China, Italy, and Japan. Forecast highlights include:
- North America and Europe. With $566 billion in total travel spending, the US is the largest single travel market and will retain the top spot through 2028. Consumers in Western Europe love to travel. According to Forrester’s Consumer Benchmark Survey, 2023, more than 50% of online adults in Germany, Italy, Spain, and the UK said they enjoy traveling in their spare time. Digital buying also drives growth; the UK has the highest share of travel sales bought online.
- China. All eyes are on China, as the world’s largest outbound travel market continues to climb its way out of the pandemic-related travel deficit. Chinese outbound tourism is expected to fully recover by 2026 due to improved air capacity and visa waiver pacts with select markets.
- Online Travel Agencies (OTA) gain market share. The leading seven OTAs accounted for nearly 46% of global online travel spending in 2023, up from 40% in 2022. OTAs leverage their highly variable cost structures to respond to and rebound quickly from market fluctuations. In 2020, Booking Holdings and Expedia cut sales and marketing expenses by more than half to respond to the pandemic sales drop and saw a faster return to growth post-pandemic.
- The travel market will grow faster than the global economy. The global travel market will see 6.0% CAGR between 2024 and 2028. The growth of the middle class, especially in India, Indonesia, the Philippines, and Vietnam, will power this growth. Increased workplace flexibility and greater freedom of movement will also play a role: Today, the average passport holder can travel visa-free to as many as 111 countries, nearly double its value in 2006.
You can find these insights in our new Global Travel Market Forecast, 2024 To 2028 where we examine total, domestic, and international travel growth across 14 markets that capture 73% of global travel spend: Australia, Brazil, Canada, China, France, Germany, India, Italy, Japan, Mexico, South Korea, Spain, the UK, and the US. The forecast also breaks out online and offline travel across air, hotel, car rental, and rail. If you are a Forrester client, we invite you to schedule an inquiry or guidance session with Cindy Liu to discuss our latest findings.
