The Great Travel Boom
Mohit Golecha@mohit
The idea
I believe travel is only getting bigger, and the spending stretches well past the plane ticket to where people stay, what they do, and how they share it. So this basket follows the whole trip: the biggest weights are booking sites and hotel chains that earn on every trip, plus the engine and parts makers that get paid whenever planes fly. Airlines and cruises are smaller slices since their profits swing with fuel and the economy, while experiences and the platforms behind travel photos and posts round things out.
What will be bought
- Booking platforms and hotel chains collect fees on nearly every trip, capturing value regardless of which airline travelers choose. · Booking HoldingsIt collects a cut every time someone books a hotel, flight or rental car through its sites, so more trips worldwide mean more fees., AirbnbIt earns on every night someone stays in a home, which covers the longer trips and group travels that a travel boom brings., Marriott InternationalIt mostly collects fees from hotels that other people own, so it gains when more rooms fill and room prices rise, without paying for the buildings., Hilton WorldwideIt runs almost entirely on fees from hotels carrying its brands, so more travelers and higher room rates flow straight to its profits., Expedia GroupIt owns multiple booking sites for hotels, flights and vacation homes, so it collects on the trips people book through its platforms.30%
- More flights mean more engine hours and parts wear, generating decades of aftermarket revenue for makers of engines and components. · GE AerospaceIts engines power a large share of the world's passenger jets, and it makes most of its money servicing and repairing them, so every extra flight hour earns it revenue., RTX CorporationIts Pratt & Whitney engines power many single-aisle jets, and its Collins unit makes plane parts, so more flying means more engine work and parts sales., HEICOIt makes approved replacement parts that cost airlines less than originals, and gets more orders as planes fly more and parts wear faster., BoeingIt has years of planes already ordered by airlines that need more capacity for increased travelers, so a boom shows up in its future deliveries.21%
- Once travelers arrive, they spend on concerts, parks, slopes and tours, which are the parts of trips they remember and post about. · Live Nation EntertainmentIt runs concerts and festivals and owns Ticketmaster, and more people are traveling to see shows as part of a trip., Walt DisneyIts parks and cruise ships are destination trips people plan and post about for years, and more travelers boost attendance and spending., Vail ResortsIt owns ski mountains in North America and sells the Epic Pass, so it earns on ski trips, lodging and lessons., TripadvisorIts Viator unit sells tours and activities people book once they arrive, capturing the experiences part of a trip.15%
- These companies sell seats and cabins directly, so they gain the most when demand surges, and they also face the biggest swings from fuel and economic cycles. · Delta Air LinesIt earns significantly from premium seats and its American Express card partnership, which helps when travelers spend more on trips., Royal CaribbeanIt sells whole vacations at sea with ships and private islands built for the kind of trips people plan and share., United AirlinesIt has the biggest international route map of US airlines, so it stands to gain most when people take long trips abroad., CarnivalIt runs the biggest cruise fleet with lower-priced brands that bring first-time cruisers on board, capturing growth in the travel boom.14%
- Travel photos, videos and planning happen on platforms and cameras owned by these companies, which monetize that activity through ads and hardware sales. · Meta PlatformsInstagram is where people show off their trips, and travel companies buy ads there to reach them, feeding the bragging part of travel into its ad sales., Sony GroupIt makes cameras people bring on trips and the image sensors inside many phones, so more travel photos and videos help drive its sales., PinterestPeople use its boards to plan trips and save places they want to go, making it a platform where travel brands pay to advertise.12%
- Cash8%