Travel and hospitality firms, however, said demand for overseas holidays such as European summer breaks has softened amid soaring fares. Prime Minister Narendra Modi had also made a call to avoid non-essential overseas travel.
The picture is encouraging on the domestic front, they said.
“Travellers are driving down to nearby destinations, a pattern we are seeing consistently across all major cities,” MakeMyTrip CEO Rajesh Magow said. “Group travel is up, whether families or friends travelling together, and that is reflected in a clear uptick in intercity cab and bus bookings on our platform.”
He said the demand picked up almost immediately as schools closed for summer vacations, which is consistent with the seasonal pattern.
Social media posts attest to the trend, with travellers referring to traffic jams stretching for hours around destinations such as Dehradun and Sikkim. Airfares have risen by as much as 30-40% year-on-year this summer due to elevated aviation turbine fuel costs amid the West Asia war. Many international routes are impacted by airspace closures and longer flight paths as well.
As a result, most international travellers are opting for ‘value-driven’ short-haul destinations, said Aloke Bajpai, group CEO of ixigo.Vietnam has emerged as the fastest-growing destination with a 130% growth over last year, followed by Sri Lanka (68%), Singapore (32%) and Thailand (22%), replacing earlier favourites such as Indonesia and Japan, he said.
While domestic travel demand remains “strong,” higher airfares are encouraging some to consider trains and buses instead, Bajpai said. Many travellers who were planning international vacations are now opting for domestic getaways, he added.
For the May-June travel period, bus bookings to hill stations and cooler destinations on ixigo have grown by 38% year-on-year, with destinations such as Coorg, Kodaikanal, Nainital, Shimla, Ooty and Munnar witnessing significant traction.
Hotel chains such as Radisson Hotel Group and ITC Hotels report higher demand than last year in several locations.
Overall occupancy levels for Radisson Hotel Group’s India portfolio are up by about 5% on year this summer, with average occupancies at leisure destinations currently trending close to 75%, said Nikhil Sharma, managing director and COO, South Asia, at Radisson Hotel Group.
ITC Hotels managing director Anil Chadha said ultra-premium hill properties of the chain across locations such as Chail, Mohali, Manali, and Dharamshala are doing “exceedingly well” while the ITC properties in Jaipur, Goa and Agra are seeing strong demand due to “drivecations.”
Long-haul international travel has dropped.
“Domestic travel seems to be doing well, but with Air India cutting flights to the US and prices escalating, long-haul travel has taken a beating,” said Sunil Kumar, president of Travel Agents Association of India. “Vietnam is doing well, but flight fares for routes such as Hyderabad to Thailand are quite high,” he added.
“People are cutting off the Middle East as an option,” Kumar said.
Rajiv Mehra, general secretary at Federation of Associations in Indian Tourism & Hospitality (FAITH), said leisure travel to the Gulf, which used to account for 30-35% of India’s total outbound travel, is in the negative zone.
“Further, travel to the USA and Western Europe has also been impacted as airfares have turned dearer and rupee has depreciated much against the currencies of these regions,” he added.
A spokesperson at Pickyourtrail said Indian travellers are not stepping away from international holidays but are planning better.
At Pickyourtrail, summer international enquiries are 10-15% higher compared to last year, while confirmed bookings are 8-10% higher, the person said. “Short-haul destinations such as Thailand, Maldives, Sri Lanka, Malaysia, Bali and Vietnam continue to perform strongly, while travellers are approaching select long-haul routes with more planning and care.”
The intent to travel has not been dented and companies are backing on domestic demand.
Leisure Hotels Group, which operates properties in prime leisure locations in north India, is seeing an overall growth in bookings of 25% compared to last year, said Shahzad Aslam, head of sales at the chain. “While factors such as rising fuel costs may be influencing how people travel, they are not deterring travel plans altogether,” he said.