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Pump predictions: rising gas costs not expected to slow leisure travel
National Report--Average gas prices rose above $2 in all states for the first time last month.
At the same time, leisure travel hit a six-year high, according to the Yesawich, Pepperdine, Brown & Russell/Yankelovich Partners 2005 National Leisure Travel Monitor.
Fifty-eight percent of American adults took at least one overnight trip of more than 75 miles last year, and of those, 93 percent took at least one trip for pleasure.
What does this mean for hotels this summer?
The survey suggests that demand for domestic travel will continue to grow, according to YPB&R. Hotel-iers also are optimistic, although they are watching the situation.
In California, which has some of the highest gas prices, Barbara Atkins, g.m. of the San Diego Days Inn Hotel Circle, near the San Diego Zoo, expects a great summer and said that occupancy hasn't been affected so far.
"We're talking about it all the time, but I don't think guests will change plans," Atkins said. "Nobody likes the increased gas prices. They've agreed to suck it up because they still need to de-stress. It's just going to cost them more."
Patrick Cook, director of sales and marketing for the Sheraton Chicago Hotel and Towers, does not expect gas prices to affect the hotel's business plan.
"A great deal of our weekend business comes from a 75-mile drive-in radius, so if anything, it would help us," Cook said. "If people are less inclined to travel further because of fuel prices, and they stay closer to home, it will probably create more demand for downtown Chicago."
The proximity of the Sheraton to Michigan Avenue and Navy Pier helps, he said.
"A lot of weekend family business comes here," Cook said. "We're planning on every bit as strong a season as we have seen the last few years. Every Friday and Saturday for about the middle six months of the year we will come close to, if not sell out, those days. I think we're in pretty good shape."
Location also helps Branson, Mo., according to Chris Myer, v.p. of marketing for Myer Hotels, which owns two Best Westerns and three Comfort Inns in Branson.
"Branson has typically fared well when there's been high gas prices or other crisis because it's such a reasonable destination," Myer said.
He pointed out that guests driving 350 miles--the average distance for the area--would pay about $20 more roundtrip than last year.
"In that scope of things, will it prevent them from coming? Probably not," Myer said. "The overall issue becomes: Do people have disposable income to take a vacation? There's not a lot you can do about that. I believe most Americans will travel if they at all possibly can."
As far as changing business plans for the hotels, Myer said, "I've never seen where discounting increases profitability."
"You hope for the best and plan for the worst," said Mark Price, g.m. of the Fairfield Inn- SW Hospitality in Flagstaff, Ariz., which is three miles from Grand Canyon National Park.
He added that management will wait to see what happens, but has a contingency plan.
"There are a lot of people who come from the four states around us who will still travel," he said. "It will have an effect of course, but a lot of our business comes from Phoenix, Albuquerque, [Las] Vegas. Those are small enough jaunts that people aren't going to worry too much yet. For longer trips, it's going to make a big difference."
Mini vacations
Frances Rudder, g.m. of the Best Western Plaza Inn in Pigeon Forge, Tenn., agreed that people probably will make shorter trips.
"Since we're such a destination, I'm sure we'll feel some of the effects, but not as great as some other areas in the country," she said. "Before, when gas prices went up, it didn't affect us because so many people come from surrounding areas."
Where the hotel is feeling the impact of gas prices is in product costs.
"We're feeling some of the effects in the price of our products, including cleaning supplies, that are shipped to us," Rudder said.
National parks top the list of specific destinations that interest American leisure travelers, with 66 percent expressing interest, according to the YPB&R survey. That's good news for Don Lightenburger, owner of the Holiday Inn Express--Mesa Verde-Cortez (Colo.).
"We have an extremely small airport, so almost everyone comes in by automobile," Lightenburger said.
Everybody complains about gas prices, but from the leisure traveler's standpoint, it's difficult to predict what summer will hold, he said.
"Every day and every year is different," Lightenburger said. "We're running about the same as we have been. I think people won't travel as far. Someone from Denver who might have gone to Los Angeles may come to Cortez and visit Mesa Verde National Park. But then, the people in northern California might go to Disneyland instead of coming here."
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