Posted on 05/15/2008 1:17:09 PM PDT by 300magnum
NEW YORK (Reuters) - Record-high fuel prices and a slowing economy will shrink travel in the United States over the coming Memorial Day holiday for the first time since 2002, auto and travel group AAA said Thursday.
Some 37.87 million Americans will travel 50 miles or more from home for the holiday, which falls this year on May 26. That would be down 0.9 percent from 38.23 million last year, according to AAA's survey which was conducted on more than 2,000 Americans.
"This is the first time we've seen a decrease since 2002, after the downturn that followed the September 11 attacks in 2001," said AAA spokesman Michael Pina.
Of those travelers, 31.7 million will go by automobile, down 1 percent from last year's 32 million road travelers, according to the survey. Some 4.35 million people will fly, down 0.5 percent from the 4.37 million people who took to the skies last year.
"Because of the convergence of high fuel costs and economic trouble, there's some softness in people's confidence. But all things considered, this still reflects pretty robust travel," said Mark Brown, executive vice president of AAA.
The national average of U.S. retail gasoline prices has jumped about 21 percent since a year ago to more than $3.77 per gallon. On Wednesday, Alaska became the first state in which the average price for regular gasoline hit $4 a gallon, according to AAA.
The dim outlook for travel over the first holiday of the summer driving season comes amid growing evidence of softening fuel demand in the world's biggest energy consumer as high prices at the pump combine with the effects of an economic slowdown.
Gasoline use has already slipped about 1 percent so far this year compared to last year, according to government and private reports. And the U.S. Energy Information Administration said last month it expects American gasoline usage to shrink during the summer for first time since 1991.
Exxon Mobil Corp chief executive Rex Tillerson said Thursday the price of gasoline in the United States is at or near the level where people begin to curb their usage.
"We're already seeing some demand slackening in gasoline demand in terms of miles driven," Tillerson told NBC's "Today" program. "So I think we're very near, if we're not already at, the price where people clearly are altering their daily behavior."
(Reporting by Richard Valdmanis; Editing by John Picinich)
Why don’t we wait until *after* the event has happened?
Gas here in MI has already hit $4.00/gal., and I don’t see anybody slowing down out there.
People here are not “speeding up” like they used to. $3.85 to 3.98 here.
No, the price of gasoline is down year over year.
No,the demand for gasoline is inelastic so people won’t cut back. THey can’t.
Looks like I'm guilty of making an incomplete point. Let's wait until *after* the holiday weekend to see if travel is actually trending downward. Many times, these travel predictions prove false.
On the other hand, I think the demand for gasoline is very elastic. For instance, at $50 / gl., I would expect alot more carpooling to work than I see now.
I’m kidding... I’ve been driving without the air conditioning as much as possible, and I cringe every time I have to hit the gas. I’m also getting a new motorcycle.
Not in the short-term. But in the long-term, people can buy smaller cars, telecommute, move closer to work, etc.
I started doing that when gas hit a "ridiculous" $4 a gallon. Luckilly, I have only a 30-mile roundtrip drive, but I did pick up about 2 mpg. On the other hand, people on the Interstate are still screaming by me at 75-80 mph in their SUVs and other gas guzzlers (Nevada).
Next thing is to replace my air filter - have already bumped up tire pressure another 5 lbs.
Congrats on the new bike! (One excuse for a new motorcycle is as good as another!)
As I have been traveling to work on my motorcycle, I see folks with their foot to the floorboard as they leave every traffic light. It’s usually the ones in the big dually trucks. It just reassures me that the economy cannot possibly be in as bad of shape as the media constantly tells us.
It also tells me that fuel has not gotten “expensive” yet, when everyday folks can still afford to waste it.
Maybe you can draft on them.
I have a truck and I want to keep it. So good to be able to haul things. I simply don’t want to drive it and waste gas on errands. I have a bike but it’s falling apart. It’s going to throw a rod one day and then it’s not going to be worth anything, so I’m going to get me a new V-strom. I can’t wait, I really can’t. I have to wait till the old one gets out of the shop.
Must be a lot of rich people round here.
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