May Day travel vouchers are bleeding: air tickets and hotels are all cutting prices.

As May Day approaches again, the enthusiasm for travel is on the rise.

Oddly enough, the once highly publicized "flight assassins" and "hotel assassins" seem to be less active this year. Since the outbreak of the pandemic, the curse of soaring travel prices during holidays seems to have been broken this holiday season.

If you traveled during May Day in 2023, you might notice a slight decrease in the prices when booking flights and accommodations this year.

Amidst the joy, questions arise: Is this an illusion? Are people not traveling anymore?

Looking at the data, the answer is no. This May Day, the frenzy for travel has reached new heights.

Flight management services predict that during the 2024 May Day holiday, the average daily number of passengers is expected to be around 2.088 million, an increase of about 11% compared to the previous year and about 15.6% higher than in 2019.

Meanwhile, the average ticket prices during May Day have decreased by 5.1% compared to the same period in 2023.

In other words, we're seeing a typical case of increased quantity with decreased prices for flights:

More people are flying, yet airlines are reducing prices.

Further analysis reveals the following characteristics of the fluctuations in ticket prices:

1. Except for the "2 days before the holiday" period, domestic flight prices during the entire May Day holiday are noticeably lower than in 2023.

Especially in the "1-2 days after the holiday", the prices of May Day flight tickets have plummeted compared to last year. The "unfinished" state is particularly striking.

Secondly, among the top 20 domestic hot routes for May Day, 17 routes have seen price reductions. Among them, the one-way ticket prices for routes such as Shanghai-Guangzhou and Kunming-Shanghai have dropped by more than 400 yuan.

In fact, airlines are likely hesitant to raise prices during the May Day holiday as they have in previous years, possibly due to the "beating" from the market.

Since the end of this year's Spring Festival travel rush, the overall ticket prices have been lackluster, remaining lower than the levels seen during the same period in 2019 and 2023, due to the increase in capacity but a lagging demand from business travelers. This has resulted in increasing operational pressure for airlines.

Especially in March, despite a significant increase in overall air passenger traffic compared to 2019, the growth in capacity has been even faster. The consequence of this has been a serious decline in passenger load factor, with the average ticket price for domestic routes dropping by 328 yuan compared to February.

In March, the five major airlines - Air China, China Eastern Airlines, China Southern Airlines, Spring Airlines, and Juneyao Airlines - saw decreases in passenger load factor compared to February of 4.0, 2.2, 3.3, 3.3, and 8.9 percentage points respectively. Compared to the same period in 2019, these decreases were 2.2, 1.5, 0.82, 2.7, and 7.7 percentage points respectively.

To put it simply, it's because there are too many airplanes but not enough passengers, leading to intense competition among major airlines.

In this context, even during peak travel seasons like May Day, airlines dare not raise prices too sharply but instead cautiously adjust them.

Looking at the hotel market during May Day, it seems like they're following the same script as the airlines.

For instance, despite an increase in demand, hotel prices have dropped significantly more than airline tickets.

Data from Qunar shows that as of April 10, hotel bookings for popular cities during the 2024 May Day holiday have increased by 30% compared to the previous year, while average hotel prices have decreased by 20%.

Similarly, there's an oversupply situation leading to a tough market.

Since the Chinese New Year, the hotel industry has been struggling, with room prices consistently lower than the same period in 2023.

Additionally, during a recent internal hotel industry meeting I attended, I saw data on hotel occupancy rates during the Qingming Festival:

Except for the first day, hotel occupancy rates during the holiday and the days before and after were all much lower than in 2019.

Therefore, it is easy to understand why hoteliers have a pessimistic outlook on the May Day market: it's a holiday, so why expect miracles on May Day?

The safest way is to quietly set a "non-competitive" room rate by secretly observing the hotels within a few kilometers.

Perhaps we are witnessing history. This May Day, the "invisible hand" has finally put an end to the retaliatory tourism boom of 2023, bringing an "irrational prosperity" in tourism prices.

Relying solely on significant price increases during holidays, the momentum of "being closed for a year and making a year's profit when open" may become increasingly unsustainable.

The impact of this on all tourism businesses is profound.

At the same time, the market force of "affordable leisure travel" has reached a turning point this May Day, leading to a certain iteration of tourist destinations:

After the appearance of several rounds of phenomenon-level internet celebrity effects in non-headline/traditional tourist cities such as Zibo, Harbin, and now Tianshui, this previously neglected area has finally erupted.

Data shows that during this year's May Day period, the popularity of traditional popular tourist cities such as Sanya, Haikou, Chengdu, Xi'an, Xiamen, Xishuangbanna, Zhuhai, and Lijiang has significantly declined. New first-tier and second-tier cities such as Wuhan, Dalian, Lanzhou, Tianjin, Guiyang, and Fuzhou have seen a search popularity increase of over 20% compared to the same period in 2023.

The reason why well-established tourist cities are being abandoned might boil down to one factor: cost. The army of budget-conscious travelers seeking affordable and cost-effective journeys has extended its reach even to the county level.

According to data from Ctrip, during the May Day holiday period, hotel bookings in county-level markets increased by 68% year-on-year, while tickets to scenic spots saw a 151% year-on-year growth, both outpacing the national average.

Several mainstream online travel agencies have compiled lists of popular county-level destinations for the May Day holiday. From the perspective of a "combined edition," the situation becomes clearer at a glance.

Airfare, hotels, and destinations are all moving towards "affordable leisure travel," which in itself reflects the shift in people's preferences. Naturally, this also harbors ample market opportunities, waiting to be tapped by those with the intention.

We will continue to keep an eye on the tourism market.