Europe as a budget travel option? It’s true in 2022

Flying to Europe this year may sound as absurd as opting for premium gas. With prices this high, is it really time to splurge?

“As a result of the labor shortage and all these things going on, travel is more expensive than it has been in a long time,” says travel journalist Oneika Raymond. “Flights are really expensive. Accommodation is really expensive. And the revenge journey is one thing.”

Although travel prices continue to rise overall due to limited supply and growing demand, pockets of affordability remain.

Europe represents one such pocket, where the currency’s weakening exchange rate against the dollar and tepid demand have left prices relatively unscathed. In fact, flights within the US have become so expensive this year that some international destinations, including many in Europe, offer a relative bargain.

“If you’re willing to pay to fly domestically, look at international destinations,” suggests Hayley Berg, chief economist at Hopper, a travel booking app. “Because there’s a good chance there’s a flight to somewhere else in the world for about the same price.”

Airline tickets are less inflated in Europe

According to data from Hopper, domestic flight tickets were 30% higher at the end of May 2022 compared to May 2019.

“A plane ticket this summer within the US will cost $600 to $800,” says Berg. “For those prices you could go to Reykjavik, Iceland or Dublin, Ireland.”

Indeed, flights from the US to Europe were up just 13% at the end of May 2022 compared to the same period in 2019, according to Hopper. That trend flies in the face of tourism demand, which remains below pre-pandemic levels: About 19% fewer American travelers headed to Europe in May 2022 than in May 2019, before the pandemic, according to data from the International Trade Administration.

Simply put, prices and demand for flights to Europe are rising, but not as fast as elsewhere.

“Given how expensive domestic flights are, you can make more money with longer-haul destinations,” explains Berg.

The dollar is strong

Although 2022 may go down as a bull market for everything from stocks to cryptocurrencies, the US dollar has gained ground on many foreign currencies. The dollar was 15% stronger against the euro in May 2022 compared to May 2021, according to data from the Federal Reserve.

“Today what we’re seeing is that one dollar can buy more euros than it has been able to buy basically since the beginning of the euro,” says Berg.

This means that anything bought while traveling in countries that use the euro will be at a 15% discount, if the currency exchange rate remains stable. American travelers will enjoy this benefit on everything from food and lodging to events and transportation.

Of course, global inflationary pressures continue to drive up prices everywhere, including Europe. Annual consumer prices in Germany rose 7.9% in May, according to the Financial Times, just short of the 8.6% increase in the U.S. However, while prices may remain elevated almost everywhere, the relative strength of the dollar may help cushion the blow. .

Public transport can help you save

Inflation has affected no aspect of travel more directly and dramatically than the cost of renting and operating a vehicle. Rental car prices increased by 69% in May 2022 compared to May 2019, according to data from the US Bureau of Labor Statistics. And everyone knows how much gasoline prices have risen.

These factors should make this the summer of public transportation for money-conscious travelers. However, the US offers few tourist destinations that can be explored by train.

Not so in Europe, where the most popular cities offer safe, affordable and reliable transit. Cities such as Amsterdam, London and Copenhagen can be explored for just a few euros, which equates to just a few US dollars with favorable exchange rates.

Visiting US national parks made sense in 2020 and 2021 for a number of reasons. But saving money in 2022 means skipping cars altogether when possible.

Off the beaten path?

We are indeed in strange times when traveling to Europe represents an unattainable and budget-friendly choice. However, the facts speak for themselves. Airfare to Europe is growing less quickly than domestic fares, and fewer travelers are visiting the continent. The dollar is strong and the US has lifted the testing requirement for arriving travelers, making it a pain to leave the country.

All of this has combined to make Europe a good choice for travelers in an upside down year. Driving on the rails in Zurich can be cheaper than renting a car in Cleveland.

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