Tags: US | Summer | Travel | gas

Cheaper Gasoline May Not Be Enough to Boost Summer Driving

Tuesday, 15 May 2012 11:42 AM

 

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Cheaper gas won't be enough to get many more Americans on the road this summer. They're still too worried about their jobs and the economy.

Economists and tourism experts are expecting only a small uptick in summer travelers. Gas prices are lower, but still high enough to keep some Americans off the road. The job market is improving, but still shaky. And household debt remains high.

Those who do travel won't feel free to splurge. The bulk of road trippers, experts say, will take shorter trips and reduce food and entertainment spending to conserve cash.

"Travel is about security," said John Larson, Vice President for IHS Global Insight, the firm that analyzed the AAA study. "If you feel less secure about your future, you may be less willing to take this trip."

For Memorial Day weekend, auto club AAA estimates that 34.8 million Americans will take trips of at least 50 miles. That's a half-million more than Memorial Day 2011 but equal to the number who traveled two years ago. Roughly 30.7 million — or 88 percent of those traveling — will drive, up 1.2 percent from last year, AAA says. Memorial Day tends to be a good indicator of summer travel overall.

Gas prices may keep some low-wage earners home. But for the most part, Americans will buck up for gas, assuming they can afford to take a trip in the first place.

Douglas Frechtling, chair of the Department of Tourism and Hospitality Management at George Washington University, says broader economic concerns far outweigh gas prices for most Americans when considering summer vacations. Slowing job growth is likely rattling some families, and rent, car payments and other bills take priority over vacation.

Gas was averaging around $3.85 per gallon when AAA spoke with 315 would-be travelers from April 20 to 24. The survey showed that those making under $50,000 a year will make up about a quarter of all Memorial Day travelers, down from nearly a third a year ago. Higher gas prices eat up a larger share of lower-income families' household budgets.

AAA says the 66 cent increase in the average gas price from January through early April made many people skittish about taking long road trips. The average trip will be 642 miles this Memorial Day, compared with 792 miles. Half of those surveyed said they'll travel less than 400 miles.

Some travelers will drive this summer because they can't afford to fly.

Jennifer Padilla of Santa Fe, New Mexico says her family is shelving a planned trip overseas this summer with family because her husband took a pay cut. Instead, the couple, their 3-year-old son and a friend will visit the sites in Bryce Canyon and Monument Valley, Utah in their Honda CRV.

The average roundtrip domestic airfare this summer is expected to be up 9 percent to 10 percent from last year, according to Travelzoo. That's on top of a 5 to 7 percent increase between 2010 and 2011. AAA estimates that 5.5 percent fewer people will travel by plane this Memorial Day. The industry trade group Airlines for America is somewhat more optimistic about summer as a whole, predicting a slight 0.2 percent decrease in air travelers.

AAA and IHS found that Americans with incomes over $100,000 a year will make up a greater percentage of travelers than a year ago — 36 percent compared with 30 percent. Middle-income Americans will account for 38 percent, down from 39 percent.

Families will carefully budget travel spending. Sixty-five percent of Memorial Day travelers surveyed by AAA say they'll cut back on entertainment costs during the weekend. Spending per person is expected to rise just $10, to $702, although falling gas prices could give travelers a few extra bucks to spend.

The U.S. Travel Association estimates Americans will spend about $725.4 billion on travel this year, up 3 percent from 2011, but less than half the increase between 2010 and 2011. Frechtling says about half of all trips are taken in the summer and the period accounts for about 40 percent of the year's spending.

© Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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