 In tough economic times, Americans still trying to salvage their summer travel plans.
Brett Schwartz - Washington Prism It used to be that this time of year families and co-workers would talk about where they were heading for their summer vacations. However, during these challenging economic times in the United States – a sub prime mortgage crisis, the weakening of the dollar, and increasing gas prices – the conversation around dinner tables and water coolers has now shifted as to how to afford a summer vacation. The summer travel season is the busiest of the year and while many tourists will board airliners to reach their destinations, the majority of Americans will pile into the family car and head for the highway. Facing record gasoline prices, travelers will have to stretch their imaginations as much as their wallets in order to go on summer vacation, an annual pilgrimage for many families in this country. Like all other market commodities, the price of gasoline (and more specifically the crude oil from which it is refined) is impacted by supply and demand. In these early years of the twenty-first century there has been no shortage of demand for oil. While the United States remains the world’s largest consumer, countries such as China, India, Brazil, and oil-rich Middle Eastern states are also guzzling huge quantities of “black gold” to build their rapidly growing economies. While a higher demand has led to higher prices, many other factors have been influencing the price Americans are paying at the pump. Experts point to the weakening of the U.S. dollar and the effects of instability in many of the world’s oil-producing countries such as Iraq, Iran, Nigeria, and Venezuela. Gasoline prices can also fluctuate depending on the season, with the summer months recording the highest prices due to more demand from April to September. The U.S. Department of Energy recently released its latest “Short-Term Energy Outlook” report which forecasts the average price per gallon of gasoline in 2008 will be $3.52, a 71 cent increase from 2007. The report also predicts that summer gasoline prices will average $3.66 per gallon. (At the time of writing, gas prices averaged $3.77 per gallon nationally and $3.90 per gallon in Washington, DC). These numbers pale in comparison to what consumers in, say, the UK, Denmark, or Turkey pay to fill their gas tanks. For better or for worse, however, the American public has grown accustomed to low gasoline prices. Cheap gas has become a part of American culture, as reflected in the large number of SUVs and trucks that populate the nation’s highways. So do these high gas prices spell the end of summer vacation for Americans? Definitely not, say tourism experts, travel agents, and everyday people eager for a diversion from the daily grind. Despite the state of the economy and high gas prices, Americans are “not willing to give up their summer vacations,” says John Townsend of the Mid-Atlantic American Automobile Association (AAA), the country’s largest travel organization. Instead, he believes tourists will seek alternative destinations closer to their home, perhaps within their home state or in a neighboring state. “There are a lot of places you can go on a tank of gas,” he emphasizes. Tourists may also stay at less expensive lodgings and eat at more affordable restaurants to compensate for the increase in travel costs. Larry Yu, professor of hospitality management at George Washington University in Washington, DC, agrees with Townsend’s prediction. While Americans will still travel during the summer season, “the high gas price will have an impact on how to travel and where to have a vacation,” he wrote Washington Prism via e-mail. “As consumers cut back on discretionary spending to pay for gas and food, they will tend to plan short trips in the regional area. Therefore, local beaches, regional theme parks and attractions will be popular destinations.” Both Townsend and Yu recommend properly planning ahead and budgeting the trip before hitting the road. AAA offers a Fuel Cost Calculator (http://www.fuelcostcalculator.com/) which allows travelers to calculate the cost of a road trip prior to departing. Other websites such as Gas Buddy (http://www.gasbuddy.com/) provide daily updates of gasoline prices throughout the United States and Canada. Travelocity, one of the most popular internet travel booking websites, predicts a strong summer season despite the economic setbacks. The company issued a press release stating that “there are no big indicators of a slowdown in summer demand.” The company says that for trips within the United States there has been strong interest in destinations such as Las Vegas, Orlando, and New York City. Outside the country, Americans are booking trips to Mexico, London, and the Caribbean. However, Travelocity says that tourists may have to shorten the length of their trips to meet budgetary restraints.
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