Cheaper fuel, signs of recovery don't mean more travel

Add a record drop in gasoline prices to growing signs that the nation is hoisting itself out of recession and you've got a sure-fire formula for increased travel this spring and summer.


Not necessarily, as it turns out.

A survey by the Monitor of key sectors of the travel and tourism industry indicates that most sources are anything but sanguine about the prospects for significant growth in the months ahead.

The latest US consumer price index (CPI), released March 23 by the Labor Department, indicates that the cost of gasoline decreased by 6.7 percent in February and is down by almost 11 percent over the last four months. The February decline was the greatest since the government began tracking gasoline prices in the mid-1960s. Fuel is now almost 17 percent cheaper than it was in 1981, when prices peaked.

But this news is moderated by several factors. For one, the national unemployment rate still stands above 10 percent. For another, the nickel-a-gallon federal tax increase on motor fuels is scheduled to take effect April 1. According to most predictions, the boost will cost the average motorist

For another, various states are hiking their own gasoline taxes to try to come up with the money to match federal aid for road-building and repair projects. The latest of these is Massachusetts, whose Legislature is trying to decide whether a 1-cent or 2-cent increase is appropriate.

Also, there is no assurance that fuel prices will continue to drop. Already some oil companies are raising prices, which could mean upward pressure on the March CPI.

Thus, says a spokeswoman for the American Automobile Association (AAA) in Falls Church, Va.: ''There are too many variables - still a lot of uncertain economic conditions, still people out of jobs. Whether consumers are going to use lower gas prices as an excuse to travel, there's no way of telling. If they have the money and the jobs, they'll probably go.''

But the AAA notes that orders by local member clubs for its popular tour books are up by only 1 percent so far this year, as opposed to 5 to 10 percent in a normal year.

Amtrak's ridership is down 6 to 8 percent for the first quarter of fiscal 1983, says John Jacobsen, its director of external communications. The federal rail passenger service, however, is approaching its busiest season except for the Thanksgiving and Christmas holidays: the Memorial Day to Labor Day period. A moderate growth in passenger volume is expected.

Mr. Jacobsen is not especially worried that dropping gasoline prices will cause Amtrak ridership to fall.

''The average family may not want to pack its two kids and a dog into a Chevette and take a vacation trip,'' he says. ''The fact that fuel prices are falling doesn't necessarily mean they'll be able to travel in comfort in their compact car.''

Greyhound, the big intercity bus line, buys 72 million gallons of diesel fuel a year, so ''obviously (falling fuel prices) lower our costs,'' says public relations director Leslie White. ''We figure a $1 drop in a barrel of oil saves us a penny a gallon.''

But she adds that the company does not know what to expect in the way of an impact on ridership.

''I wish we did know. There's just no crystal ball to tell us these things,'' Ms. White says.

The US Travel Data Center in Washington, D.C., which monitors personal vacation preferences for the tourism industry, takes an optimistic view, however.

According to spokeswoman Ida Simmons: ''The travel industry is poised for recovery and certainly will feel the impact of lower gasoline prices. We feel there is a lot of pent-up demand for vacation trips. People have been postponing vacation travel for one to two years. Once they begin to see that recovery is under way, they feel more relaxed about spending money on trips and not jeopardizing their discretionary income.''

The center is not due to release its next random-sample survey of domestic travel plans until early May, but Ms. Simmons says there are already indications that people's intentions to travel by air are up.

The major domestic carriers already are experiencing growth in ridership, because of the combination of reduced flights and fare wars.

The problem, says United Airlines spokesman Chuck Novak, is that there isn't much yield from all that growth. It's tough to make much money when a coast-to-coast ticket has sold for as little as $99. But ''you can't drive it that cheaply, I'll tell you,'' he adds.

Mr. Novak sees a pattern of contined fare discounts for pleasure travelers.

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