Historically high fuel prices are expected to have a negative impact on summer travel and are accompanied by broader economic concerns for many Americans.
The Travel Industry Association of America (TIA) forecasts  travel volume growth of less than 1% this year amid relatively soft travel intentions. According to TIA’s Summer 2006 Forecast, Americans will take 325.6 million leisure person-trips during June, July and August 2006. A person-trip is one person traveling 50-plus miles, one-way, away from home.
“I am concerned about a number of economic indicators with gasoline prices and the pocket-book impact they’re having leading the way,” said Suzanne Cook, TIA senior vice president of research. “We’ve had gasoline prices jump up for the summer travel season before and weathered it but there are additional factors to be considered this year.”
Cook explained that gasoline prices of $3 per gallon could be the “tipping point” for many Americans. For example, it is the point at which 10% of travelers say they would seriously consider canceling a trip. Between $3 and $3.24 per gallon, an additional 26% would seriously consider canceling a trip.
While the higher cost of gasoline this year will add only about $30-$50 to the cost of the typical vacation, that alone does not account for the possible impacts on travel spending decisions from the week-to-week costs of keeping their gas tanks full prior to a vacation.
Cook added that gas prices further complicate the picture because they threaten to fuel inflation and undermine economic growth and consumer confidence more generally.
Other highlights from the report include:
• Five percent of summer travelers plan to use an RV, while 6% intend to enjoy an all-inclusive resort and 6% say they plan to take a cruise.
• The expected reversal of last summer’s travel pattern. Gas prices should cause weaker demand early this summer but demand will grow stronger as the summer wears on and travelers get used to high gasoline prices. This assumes that gas prices have stabilized and may even decline over the summer and that there are no more gas price surprises, or other events.
• Continuing past trends, air travel and hotel demand will rise even as hotel room rates and air fares go up.
• International travel to the U.S. will continue to rise as declines in the value of the dollar make the U.S. an international travel bargain and as airlines more vigorously pursue international markets and add capacity.