AAA PROJECTS NEARLY 4 PERCENT MORE WILL TRAVEL OVER

CHRISTMAS-NEW YEAR’S HOLIDAYS

 Year-over-year increase in travel reflects growing confidence in the economy.

NEWS from AAA South Dakota, Dec. 16 – AAA predicts 87.7 million Americans will travel 50 miles or more from home over the upcoming year-end holidays. This is a 3.8 percent increase from the 84.5 million Americans who traveled during the same Christmas / New Year’s period one year ago, and is the largest projected increase for any major holiday this year.

The number of travelers by motor vehicle is expected to total 77.7 million in this year compared to 74.4 million last year, an increase of 4.4 percent. The number of those flying is expected to be 4.2 million compared to 4.1 million in 2008, an increase of 2.9 percent. The number of those traveling by other means, including, trains, watercraft, buses and multiple-modes of transportation, is expected to top out at 5.8 million compared to 6.0 million last year, AAA said. Last year, the total number of travelers during the year-end holidays, 84.5 million, represented a decline of 4.7 percent from Christmas / New Year’s, 2007.

AAA predicts the number of South Dakotans traveling 50 miles or more from home over the holiday period will total about 277,450, an increase of 15 percent over the same time last year. Auto travel is expected to be 15.3 percent above 2008 levels, with 253,323 South Dakotans taking to the highway over the 12-day holiday period. Air travel is also predicted to be above Christmas / New Year’s, 2008, with 9,650 flying to holiday destinations this year, an increase of 21.7 percent.

“More Americans traveling during the winter holidays is another sign consumers are continuing to grow more confident in their personal financial situations,” said AAA South Dakota spokesman Mark Madeja. “The moderate projected rise in the number of air travelers this holiday period is especially welcome since the airline industry has been hit particularly hard by the recession.”

AAA’s projections are based on research conducted by IHS Global Insight. The Lexington, Mass.-based economic research and consulting firm teamed with AAA earlier this year as part of an agreement to jointly analyze travel trends during the major holidays. AAA has been reporting on holiday travel trends for more than two decades.  For purposes of this forecast the year-end holidays travel period is defined as trips that include travel of 50 miles or more away from home during the period from Wednesday, Dec. 23 to Sunday, Jan. 3.  The complete AAA / IHS Global Insight 2009 year-end holidays forecast can be found at AAA.com/news. 

Gasoline prices – while higher – will not deter holiday travelers, AAA says

Eighty-eight percent of year-end travelers are expected to get there by automobile, while five percent are projected to fly. In November, the time when most people make decisions regarding year-end travel, average gasoline prices were 50 cents more expensive per gallon than they were in November of 2008. Despite these higher prices, AAA believes the impact of increased fuel costs on year-end travel will be minimal. This is because the average cost of self-serve regular gasoline remains well-below $3 per gallon, and because prices have been fairly stable since mid-October, staying between $2.60 and $2.70 per gallon on a nationwide average basis. Today’s national average price for self-serve regular stands at $2.594 per gallon,93 cents above where the price was one year ago. The South Dakota average today is $2.629, which is 98 cents more than the price recorded on Dec. 16, 2008.

Average spending: $1,009.  Average distance traveled: 791 miles

Americans are expected to spend approximately $1,009 per household on travel during the Christmas / New Year’s period. The largest average share of all spending will be on transportation and transportation-related charges. Approximately 11.6 percent of spending will go toward lodging. Dining will account for 17.6 percent of total holiday spending, while shopping will account for 17.6 percent. Entertainment and recreation expenses will account for 13.1 percent of the average travel budget.

Christmas / New Year travelers around the country will average of 791 miles roundtrip this upcoming holiday weekend. An estimated forty percent of travelers will journey more than 700 miles round trip. One-quarter of travelers will log between 251 and 700 miles. More than one-third (35 percent) of travelers will journey 250 miles or less round trip. 

Airfare and rental car costs: slightly higher.  Lodging expenses: lower

According to AAA’s Leisure Travel Index – a monitor of pricing in 20 popular cities across the US for hotel and car rentals, as well as 40 pairs of cities for air travel pricing – the lowest average published airfares over the year-end holidays period are expected to increase two percent from last year to an average of $179 per roundtrip ticket.  Car rental rates also will increase, up two percent to an average of $50 per day for a mid-size car versus $49 per day last year.

Rates for AAA Three Diamond lodgings are expected to be ten percent less than last year with travelers spending an average of $119 per night. Travelers planning to stay at AAA Two Diamond-rated lodgings will pay six percent less than last year; an average of $86 per night. These are the lowest average lodging rates for this time period since 2004.

Holiday Forecast Methodology

In cooperation with AAA, IHS Global Insight has developed a unique approach to forecasting actual travel that explicitly considers current economic conditions, past holiday travel trends and behavior, and the recent assessment of pre-holiday American travel intentions derived from a survey of 1,350 American households.*

The intentions figures act as a leading indicator, but do not constitute the forecast itself. Instead, travel intentions overlay other key travel drivers along with past trends in an effort to project what Americans will actually do. The approach recognizes Americans do not always behave as they say they will.

The actual travel figures come from the ongoing travel panel database of D.K. Shifflet & Associates, the premier source of American travel volume and behavior.  DKSA interviews more than 50,000 American households per month in an effort to track trip incidence, composition, behavior, and spending – all after the trips have been taken.

As North America’s largest motoring and leisure travel organization, AAA provides more than 51 million members (89,650 in South Dakota) with travel, insurance, financial and automotive-related services. Since its founding in 1902, the not-for-profit, fully tax-paying AAA has been a leader and advocate for the safety and security of all travelers. AAA South Dakota can be visited on the Internet at AAA.com.

* The first two holiday travel forecasts conducted by IHS Global Insight and AAA (Memorial Day and Fourth of July 2009) utilized an initial nationwide sampling of 2,700 households to collect at least 405 respondents planning a holiday trip. These respondents were interviewed in detail about their intended trips. Beginning with the 2009 Labor Day holiday travel forecast, 1,350 households are being included in the initial survey; however, at least 405 respondents will continue to be interviewed in detail about their intended trips. 

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