Summer Travel Outlook Improves

by Doug Desjardins

Travel industry analysts are forecasting an increase in summer tourism this year but expect only a marginal increase as a slow economy continues to keep consumer spending tamped down.

To start things off, the American Automobile Association (AAA) is forecasting a 5.4 percent increase in travel for Memorial Day Weekend compared to last year, a slight increase and the first since 2005. Glen MacDonell, director of travel services for AAA, said the group is expecting the official first weekend of summer to be a busy one.

“The number of Americans traveling on vacation this Memorial Day will increase 5.4 percent from 2009 with approximately 32.1 million travelers taking a trip away from home,” said MacDonell. “Last year, 30.5 million Americans traveled during that same period.”

The vast majority of travelers – about 28 million – will be taking their trips by road despite higher prices at the pump. The U.S. Energy Department estimates the national average per-gallon was $2.78 the week before Memorial Day, down 6.3 percent from one month ago but 30 cents higher than at the same time last year.

The era of the “staycation” also appears to be coming to an end. According to a survey from American Express, 51 percent of adults surveyed are planning to travel for summer vacation this year, up from 49 percent in 2009. That 2-percent increase matches the 2-percent jump in leisure travel being forecast by the U.S. Travel Association this year.

American Express found that people planning a vacation will spend close to $1,000 per person, slightly higher than in 2009. “The summer vacation, and particularly the family vacation, are alive and well this year,” said Audrey Hendley, vice president of American Express Travel.

Industry analysts are also forecasting an increase in travel for the rest of the summer. AAA reports that travelers are making more travel plans this year than in 2009. “AAA travel agents are reporting double-digit increases in the percentage of travelers making advanced bookings for tours, cruises and hotel rooms,” said MacDonell.

Hotel rates are also expected to jump slightly as occupancy rates begin to rise after a nearly two-year run of declines. According to Smith Travel Research, occupancy rates are expected to rise 2.2 percent this summer to 63 percent, a rate that’s still well below average. The average daily room rate is expected to take a similar jump, increasing 1.9 percent to $95.

Airline traffic is also expected to increase this summer after several years of declines. The Air Transport Association of America is projecting a 1-percent increase in airline ticket purchases for the three-month period that ends Aug. 31.