Travel abroad is poised 'for a big comeback' in 2023 as Americans eye trips to Asia, Europe

Mt. Fuji and Tokyo skyline, Japan.
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Americans are poised to travel overseas in a big way in 2023.

Households are continuing to unleash two or three years' worth of pent-up demand as Covid-19 fears wane and the last vestiges of pandemic-era border restrictions have eased.

The U.S. dollar also remains relatively strong versus currencies like the euro, hybrid work yields more flexibility for big trips and some airlines have added new long-haul routes to overseas destinations, according to travel experts.

"The travel industry is just going gangbusters," said Erin Florio, executive editor of Condé Nast Traveler.

Why travel abroad is poised 'for a big comeback'

In 2022, the share of international trips for which Americans bought travel insurance was on par with 2019 levels, the first time that had occurred in the pandemic era, according to data from online travel insurance marketplace Squaremouth. The trend has continued for trips booked for 2023.

American travelers largely stayed within U.S. borders in 2020 and 2021 amid health concerns and overseas Covid-related restrictions such as testing requirements, mandatory quarantines or outright bans on foreign tourists. Visits to U.S. national parks boomed and RV rentals soared as outdoor vacations offered the dual benefits of travel and relative virus safety.

Now, fear of the virus has waned. In September, the share of travelers unconcerned about contracting Covid surpassed those who are concerned, the first time that had happened in the pandemic era, according to Destination Analysts.

'There's a lot of pent-up travel demand'

2022 was also a year for more big trips abroad — but a spike in virus cases toward the end of 2021 and into the new year, fueled by the highly contagious omicron variant, somewhat dampened enthusiasm, experts said.

"There's a lot of pent-up travel demand," said Jessica Griscavage, a travel advisor and CEO of Runway Travel. "We missed travel for two to three years."

This so-called "revenge travel" trend — a term recently coined to describe burgeoning, pent-up wanderlust — coincides with looser health rules abroad and at home.

The U.S. dropped a Covid testing requirement for inbound air travelers from abroad in June. That rule, which also applied to U.S. citizens, mandated a negative test within a day of flying.

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Many countries had also fully closed their borders to foreign tourists. Now, most are again welcoming visitors — especially those with a Covid vaccine.

Fully vaccinated tourists can access 197 countries without Covid-19 testing or quarantine, and an additional 16 are open but require testing, according to Kayak data.

"We're pretty much at a place where we can go anywhere," Florio said.

Just 12 countries, including China, Libya, Turkmenistan and Yemen, are still closed to vaccinated Americans, according to Kayak.

Those traveling to Japan right now are 'mostly rich people,' says Japan Association of Travel Agents
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Those traveling to Japan right now are 'mostly rich people,' JATA says
Squawk Box Asia

Many countries have more restrictions in place for the unvaccinated. About 69% of Americans are fully vaccinated, according to the Centers for Disease Control and Prevention. The CDC recommends being up to date on vaccines before international travel.

Many nations — including Australia, Bhutan, Israel, Japan, Malaysia, Morocco, New Zealand, the Philippines and Singapore — eased border closures in 2022. Many European nations also dropped testing requirements for Americans. (Travelers should consult the U.S. State Department website for country-specific Covid restrictions.)

In addition, the pandemic-era surge in remote work has made "bucket-list trips more of an achievable reality," said Nitya Chambers, executive editor and senior vice president of content at Lonely Planet.

Indeed, Hopper found 67% of travelers take trips more often and 20% travel farther away due to the flexibility of remote work.

Where travel is ramping up most

Economic concerns, inflation 'aren't stopping people'

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