July 4th Travel Expected to Drop 2.5%

Wall Street Journal: Nearly 1 million fewer Americans will travel by automobile over the July 4 holiday than a year ago due to high gasoline prices, a survey by travel group AAA released Wednesday show.

Car-travel over the holiday period will drop 2.7% from a year ago, with 32.8 million Americans hitting the road between June 30 and July 4, down from 33.7 million a year ago. This year's figure is down from the record 35.1 million auto travelers hit in 2002, 2005 and 2007, but above the recession-hit 2009 low of 26.7 million travelers. Still, auto travel will make up 84% of total holiday trips.

A little more than 3 million travelers, or 8% of holiday travelers, will fly over the weekend, a 9% rise from a year ago. That's despite an 11% rise in the average price of the lowest round-trip ticket for the top 40 U.S. air routes. The remaining 8% of travelers will go buy rail, bus or watercraft.

Although the national average retail price for regular gasoline has dropped 21.5 cents a gallon from a year ago, at $3.637 a gallon on Tuesday, the price is 33%, or 90 cents a gallon above a year ago, according to AAA Daily Fuel Gauge Report. AAA said it expects prices to be around $3.60 to $3.70 a gallon during the holiday weekend.

The number of total travelers making trips of 50 miles or more during the holiday weekend by all means of transportation will be down 2.5% from a year ago, to 39 million Americans, AAA said.

A survey of intended travelers showed that 56% said gasoline prices won't impact their travel plans. Of the remaining 44%, most said they would economize in other areas to pay fuel bills, while some would take shorter trips or travel by different modes of transportation.

AAA said its travel forecast, based on economic forecasting and research from IHS Global Insight, included a survey taken between May 26 to May 30. AAA's daily gasoline prices reported by were about 14 to 21 cents a gallon then compared with Tuesday's level.

"Increased fuel costs are responsible for a shift in the demographics of the typical Independence Day traveler as higher prices impact lower income households more significantly," said Glen MacDonell, director of AAA Travel Services.

The percentage of travelers with a household income of $50,000 or less is expected to drop to 33% from 41% a year ago, while travelers with a household income of more than $100,000 are expected to increase to 35% from 26%.

AAA said the median travel distance will be down 7% this July 4 from a year ago, to an average of 573 miles, while median spending is expected to rise 25% from last year, to $807. AAA three-diamond rated hotel rates are seen at 3% about a year ago, to $147 a night, while two-diamond ranked hotel rooms are 8% higher, at $110. Weekend rental car rates will be 3% higher than a year ago.


Post a Comment