The Transportation Security Administration (TSA) anticipates a "record-setting" July 4th travel period following a booming June, according to Morgan Stanley.
The bank notes that this past Friday, the TSA screened a record-breaking 2.93 million passengers, just one of several milestones achieved in June. This follows a new single-day record of 2.99 million passengers screened on June 23rd, surpassing the previous record set in May.
Forecasting a record-breaking July 4th holiday, the TSA expects to screen over 32 million passengers between June 28th and July 8th, reflecting a near 5.5% year-over-year increase, says Morgan Stanley.
Analysts at Morgan Stanley anticipate this strong summer season to benefit airlines, particularly premium carriers (Delta Air Lines (NYSE:DAL), Alaska Air Group (NYSE:ALK), United Airlines (UAL), American Airlines (NASDAQ:AAL)). These airlines have consistently demonstrated stronger growth, maintained supportive pricing, and are likely to see resilient demand even in a volatile economic environment.
Consumer travel intentions remain stable according to Morgan Stanley's AlphaWise survey conducted in late June.
Roughly 60% of respondents plan to travel within the next six months, consistent with previous surveys and last year's data. Similar to past surveys, higher-income households show a greater propensity to travel, with domestic leisure travel remaining the most popular option, particularly among these consumers.
While essential categories like groceries lead consumer spending intentions for the next six months, travel maintains a strong position.
Notably, work-related travel intentions have ticked upwards, surpassing auto supplies purchases this month, while international leisure travel intentions showed a slight dip. This aligns with Morgan Stanley's mid-year corporate survey suggesting continued growth in travel budgets throughout 2024 and 2025.