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Outlook for U.S. Travel Suzanne D. Cook, Ph.D. Senior Vice President of Research U.S. Travel Association

Outlook for U.S. Travel Suzanne D. Cook, Ph.D. Senior Vice President of Research U.S. Travel Association. Background. We’re in a recession that just won’t quit Sharp deterioration in labor market - 5.7 million jobs lost since start of recession in December ‘07

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Outlook for U.S. Travel Suzanne D. Cook, Ph.D. Senior Vice President of Research U.S. Travel Association

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  1. Outlook for U.S. Travel Suzanne D. Cook, Ph.D. Senior Vice President of Research U.S. Travel Association

  2. Background • We’re in a recession that just won’t quit • Sharp deterioration in labor market - 5.7 million jobs lost since start of recession in December ‘07 • Unemployment rate now at 8.9 percent; forecasted to peak at 10.2 percent in Q1 2010 • Household and corporate retrenchment • Economy will remain weak; recovery expected to begin in late 2009

  3. The Economy and Consumer Pessimism

  4. Consumer Confidence posts gains but still near record low 54.9 1985 = 100 Source: The Conference Board

  5. Leisure Travel Trends • In decline since Q3 ‘08 • Travel still viewed as a “right” • Shorter, closer-to-home trips • Quest for values and deals • Trading down, not out

  6. Business Travel – The Weakest Link • $244 billion in expenditures • 2.4 million jobs • $39 billion in federal, state and local tax revenues

  7. Meetings Under Assault

  8. Business Travel Trends • 93% of companies implementing cost-cutting measures • 87% of companies plan to spend less on business travel this year - focusing more on revenue generating travel rather than education or incentives • 51% of business travel decision-makers report declines in business travel

  9. Transport Sectors Performance

  10. Domestic and International Enplanements (Percent change Q1 ‘09/Q1 ‘08) Domestic International Total Source: Air Transport Association

  11. Forward Air Bookings Very Weak

  12. Lodging Industry Feels the Impact

  13. Hotel Demand Rivals Aviation

  14. Worse in Terms of Revenue

  15. Lodging Industry Forecast 2000 Smith Travel Research, Inc.

  16. And now we have…..Swine Flu!

  17. But Some Light on the Horizon

  18. Leisure travel intentions* increase over same point last year * Percent of U.S. adults intending to take leisure trip in next six months Source: U.S. Travel Association/YPartnership travelhorizons™

  19. Traveler Sentiment IndexTM (TSI) Improving 100 93.0 90.2 • Interest • Time Available • Money Available • Affordability • Service Quality • Safety of Travel 89.1 78.2 March 2007 = 100 Source: U.S. Travel Association/YPartnership Travelhorizons™

  20. Traveler Sentiment Affordability Index on the RisePerceived affordability of travel rises… March 2007 = 100 Source: U.S. Travel/YPartnership Travelhorizons™

  21. Reflects reality of smaller increases or declines in travel-related costs (Percent change YTD through March 2009/2008) Food away from home Recreation Airfares Lodging Motor Fuel Source: U.S. Travel Association – Travel Price Index

  22. Gas prices down from $4.00+, but are beginning to rise Source: AAA Daily Fuel Gauge Report www.aaa.org

  23. Money Available for Travel Index on Par with April 2008 86.8 March 2007 = 100 Source: U.S. Travel/YPartnership Travelhorizons™

  24. Summer Domestic Leisure Travel2001 – 2009F Millions of person-trips Source: U.S. Travel Association

  25. Trend in International Visitors to U.S. (2005-2010 forecast) Arrivals in Millions Sources: U.S. Department of Commerce, ITA, Office of Travel & Tourism Industries; Secretaria de Turismo (Mexico); Statistics Canada & Tourism Economics

  26. Summary – 2009 Visitation Forecast Domestic Leisure Domestic Business International -2.5% -5.8% - 8.9% (International) -6.9% (Overseas) Source: U.S. Travel Association’ and Tourism Economics

  27. Summary – 2009 Spending Forecast Total Domestic International -8.1% -8.8% -12.9%

  28. Outlook for U.S. Attractions ?

  29. Sign up now!

  30. Save the Date October 26-28, 2009 - Little Rock, Arkansas

  31. www.ustravel.org scook@ustravel.org

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