US consumers 'wealthier than ever,' no election impact seen: RCL
Leisure travel spending is forecast to continue outpacing other discretionary spending, Royal Caribbean Group management said.
October 30, 2024
American households are 'wealthier than ever,' with leisure travel spending forecast to continue outpacing other discretionary spending and election impact seen as minimal, no matter who wins.
Those were among the takeaways from Royal Caribbean Group management during Tuesday's third quarter earnings call.
GDP growth slows a tad
The Bureau of Economic Analysis advance estimate of GDP had the US economy growing at an annualized pace of 2.8% during Q3, below the 2.9% growth expected by economists surveyed by Bloomberg and lower than the 3% growth in Q2, according a Yahoo Finance report Wednesday.
However Yahoo Finance cited Capital Economics chief North America economist Paul Ashworth as showing this reflects an economy growing at a solid pace: 'Overall, the US economy appears to be doing just fine,' Ashworth said in a note to clients on Wednesday.
'American households are wealthier than ever'
'We continue to see a very positive sentiment from our customer in a macro environment that favors growing demand for experiences and vacations. American households are wealthier than ever with continued wage growth and low unemployment driving strong consumer spending,' Royal Caribbean Group CEO Jason Liberty said Tuesday.
Leisure travel spending has grown 'a lot faster than most other spend categories over the past 12 months' with travel spending increasing at a faster pace than other leisure categories, Liberty said.
Over-indexing on travel
'Our research suggests that this trend will continue over the next 12 months with leisure travel spending growing by more than any other leisure category. Millennials, families and active cruisers are all over-indexing on both leisure travel and, specifically, cruise travel.'
For Royal Caribbean Group, 'Our nimble sourcing model and AI-enabled yield management tools, coupled with our brands' global and multigenerational appeal, allow us to successfully capture quality demand across segments sourced from new and younger consumer bases and attract the highest yielding guests,' Liberty told analysts.
Election impact?
Responding to analyst concerns about the US election impacting sales, Royal Caribbean International President/CEO Michael Bayley said: 'We've gone back and done the analysis over, literally, decades.
'And there may be a little bit of volatility during the week of the election, but when you spread it over a longer period, there's effectively no impact on bookings as a result of elections, no matter which way they go.'
About the Author
You May Also Like