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April 30, 2008

Gas Prices and Travel

I doubt that we comprehend at all the vast implications of much higher gas prices on travel.

When an American family begins to realize that a gallon of gas costs $4, and that the car might get 20 mpg, costing 20 cents a mile for gas alone, meaning $1 for every five miles the car is driven, then I think there will be less driving.  One wonders how long and how far the rubber tire travel scene will persist.

The gap between the haves/have mores and the have nots will continue to grow.  Travel will become only a vicarious and virtual experience for most of the have nots. 

One wonders how the long haul and long flight destinations will do, such as Hawaii.  With Aloha and ATA dropping into bankruptcy, there will be fewer flights going to Hawaii, and prices will probably rise.  Gas costs will also raise the fares.  At what point will the consumer simply drop out of purchasing the product?

This past month I went to two travel public relations meetings in which the promoters remained bullish.  I went to Maui HI and CA Tourism meetings in San Francisco.  Maui remains confident.  CA tourism overall is thriving.  But how long will this optimism last?

The rising gas prices will affect every aspect of the travel product that a consumer experiences.  For example, the restaurant that wants to bring in the local boutique goat cheese for its menu now will be paying more for transportation.  Every commodity that becomes part of the travel experience will have a higher energy cost.

One wonders if the golden age of travel in behind us, and the more strained era of ever more restricted travel is before us.

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