Posted by The PM on March 02, 2001 at 11:22:51:
Great article from Wall Street Journal Online.
Boom in Travel Leaves Vacationers
Scrambling to Find Flights, Bargains
By JONI JAMES
Staff Reporter of THE WALL STREET JOURNAL
In New York, a frustrated travel agent fights to find a room, any room, at
an upscale Caribbean resort for her client. With business growing, Air
Jamaica adds flights from Phoenix and Boston. And Meg Kerr, who hadn't
been planning to spend a lot on travel this year, says she just spent $4,800
on a four-day trip to Nassau. "We'll go again in a heartbeat as soon as we
get more time," says Ms. Kerr, a Miami lawyer.
A cooling economy? You would never know it in the travel industry. While
sales of everything from clothes to new homes are softening, bookings to
warm spots from Florida to Hawaii are doing even better than usual for this
time of year -- in some cases as much as 25% ahead of last year's pace.
Even the Caribbean, almost passe last year, is up. Some of this is the result
of unusually bad weather this winter, as well as trips booked before the
economic downturn. But analysts say something else may be at work, too:
Americans, usually quick to cut travel during slow times, could be changing
their spending habits.
"There is no recession -- or at
least my customers aren't part of
it," says Karen Stahlberg, of
Sunrise Travel in Eugene, Ore.
"I've been working until 10:30 at
night to finish up."
But this surprising boost for
travel companies is creating some problems for late-planning vacationers.
They're already discovering a rash of oversold flights to some islands, tight
space at many resorts, and a sudden spike in prices. Some warm-weather
resorts say they're even filling up for much of April now, usually the start of
their slow season.
"I figured I would have no problem," says Ian Crooks, who with his wife,
recently planned to take a seven-day vacation on the Puerto Rican island of
Vieques this month. Instead, the hotel he wanted only had four days
available during the time he was free. Another surprise: The hotel had hiked
rates about 10% -- to $255 a night for an oceanfront room. "I guess we'll
just have to take what we can get," shrugs Mr. Crooks, a radiation physicist
from Redding, Conn.
Clearly, weather is behind some of this, and is cited by the Federal Reserve
in its January issue of the Beige Book as a reason for the
better-than-expected performance of tourism. A cooling economy is no
match for a brutally cold winter, and this past November and December
were the coldest ever recorded in the U.S., according to the National
Weather Service.
Another factor: Several airlines have been adding services and dropping
prices to many warm spots, particularly the Caribbean -- instead of raising
them this time of year. The average lowest discount ticket to San Juan (the
main gateway to the Caribbean) from six big U.S. cities is down 13% from
1999, according to American Express. Cruise lines also have lowered
prices after a higher-price strategy backfired last year.
But while they caution that all this vacation
frenzy could quickly change, travel agents and
analysts say people's vacation budgets just
don't seem to be as sensitive to bad economic news as they have been
before. In each of the past six months, airline passenger traffic has increased
over the same months a year earlier, and was up 6.8% in January alone.
Factor out business travel, which has been soft, and the numbers are even
stronger: Online bookers such as Travelocity.com say bookings to prime
vacation spots like Florida, Hawaii, Mexico and the Caribbean were up in
25% the first five weeks this year from the same time frame last year.
Unlike in the past, vacation travel seems to be getting "almost
recession-proof," says Allen Kay, a spokesman for the Travel Industry
Association, which is predicting a 4% increase in winter travel this year.
Last winter's numbers, by comparison? Down almost 2% (although New
Year's travel last year was affected by fears about Y2K).
Caribbean Takes Off
By far, Caribbean bookings have been the most surprising. Battered by
hurricanes and high prices, many of these islands were being bypassed last
year in favor of new resorts in Mexico or more exotic destinations like Fiji.
The region had become so unpopular that the newsletter Hideaway Report,
travel bible to the rich, gave it a thumbs-down a year ago.
But, depending on the island, the
number of this December rose
anywhere from 10% (Jamaica)
to 25% (Turks and Caicos),
according to the Caribbean
Tourism Organization. Sandals Resorts International, a major
inclusive-resort chain in the Caribbean with 16 properties, says its
occupancy rates are up 10% from a year earlier, despite having opened a
new 364-room resort in December.
Carnival says bookings in January and early February were up 20% from a
year earlier, a sizable gain even when the company's 10% increase in berths
is taken into account. And Royal Caribbean reported in late January that its
bookings were up 35%. The company has added about 22% more
capacity for the 2001 season.
Such increases, though, won't come soon enough for a lot of late planners.
Last January, Melissa Pearson says she got a glossy brochure mailed to her
in Springfield, Ore., that advertised a weeklong Tahitian cruise for $4,500
for two, for a room that included a balcony. But the 42-year-old
administrator was told there was no room when she wanted to go this
season: So she and her husband are booked for November. "It looked so
nice and warm," she says.
Many hotel companies also are somewhat behind in opening new
warm-weather resorts at the pace travelers are demanding. The Four
Seasons hotel chain has only opened one new hotel in a warm-weather
destination since last winter season, and that's in Caracas, Venezuela, near
the business district. The Ritz-Carlton's one new resort hotel this winter is in
Jamaica, though the hotel company will open a golf resort in Northern
California at the end of this month and three hotels around Miami, the first
of which will be in Key Biscayne in May. Still, "we can't accommodate
everyone this spring break," says spokeswoman Vivian Deushel. "You have
to stay cautious."
Cautious Outlook
Indeed, it is far from certain whether this winter's booking season will
translate into a tight spring or summer travel season. Part of this year's
buying frenzy, for example, could be the result of some travelers' booking
earlier. Indeed, Jim Cammisa, publisher of the Travel Industry Indicators, an
industry newsletter in Miami, remains cautious about his outlook. "Not many
things go up that quickly except high-tech stock," he says. Most hotel
chains, meanwhile, aren't racing to build more rooms, either.
But, at least for now, Americans are heading south at a pace that is staving
off concerns about a sliding leisure-travel industry. "I think we're hooked,"
says Terry Trippler, airline analyst for OneTravel.com. Americans will give
up a new stove, refrigerator or loveseat, he says, "but they aren't going to
give up their vacation."
Write to Joni James at joni.james@wsj.com
Getting Away
Better hurry up with your winter travel plans: Beach resorts this year are filling up
faster than they have even in economic boom times. Below, some upscale air-hotel
packages for trips to the Caribbean and Bermuda:
Place
Price per Couple
Availability
Beaches,
Turks and Caicos
$5,000*
(5 nights)
April 13-30 tight
Comments: Resort added 166 mahogany-furnished rooms and nine
restaurants recently. But airfare portion of the package price is expected
to rise.
Casa de Campo,
Dominican Republic
$2,200*
(3 nights)
Early March flights tight.
Comments: The main draw is Pete Dye-designed golf courses, but tee
times may be tight in high season.
Southampton Princess,
Bermuda
$1,520*
(7 days)
Through April 1
Comments: Family-friendly Fairmont property offers an extensive
children's program. But with 526 rooms, this is no tropical-style villa.
Galley Bay,
Antigua
$4,000*
(5 nights)
April weekend flights
tight.
Comments: This quiet getaway offers rooms and beachfront "Gauguin
Cottages" abutting a bird sanctuary. A key restriction: No hotel guests
under age 16.
Hyatt Regency,
St. Lucia
$3,900**
(7 days)
Through April 14
Comments: A new addition to the Caribbean, this 284-room Hyatt sits
on a causeway between Pigeon Island and Rodney Bay. Spa treatments
cost extra and aren't cheap.
Grand Lido,
Jamaica
$4,100**
(6 nights)
Through April 8
Comments: Spa treatments are included at this cliffside SuperClubs
resort. One drawback: The bus ride from the airport takes nearly two
hours.
Wyndham,
Puerto Rico
$3,940**
(8 days)
Through April 14
Comments: With golf course, spa, casino, this 918-room resort offers
plenty to do and has private island getaways
Ritz-Carlton,
Jamaica
$3,000**
(7 days)
Through April 15
Comments: In this new addition to Montego Bay, the golf course
overlooks the ocean and all rooms feature a balcony. Local dining
options are plentiful.
St. James Club,
Antigua
$4,000*
(5 nights)
Saturday flights open
Comments: Quiet resort on a private peninsula boasts seven tennis
courts, three swimming pools and horseback riding. But kids' programs
are limited.
Lower Bogue: FREE
Spanish Wells: $350 + a complimentary copy of Deliverance.
* Includes airfare from New York
** Includes airfare from Los Angeles
Sources: Empress Travel, Liberty Travel, Sunburst Holidays