The death of cheap tickets? Four factors to watch!

by Tom Johansmeyer on

Are the days of bargain pricing over? There’s a lot of pessimism around this issue. After getting smacked around in 2008 and 2009, this year has been a good one for air carriers, and USA Today reports: “Airfares are on the rise again and unlikely to fall again anytime soon.” Yet, a travel industry recovery comes with advantages, as more people want to fly, and they tend to be willing to stomach higher prices. So, what’s the deal? Are we going to pay more (happily), or will 2011 means continued a continued prowl for cheap tickets, particularly online?

There’s no doubt that the airlines are getting more of our wallets. The U.S. Department of Transportation says that the average domestic ticket surged 13 percent – from $301 to $341 – from the second quarter of 2009 to the second quarter of 2010. That’s the fourth quarter in a row domestic fares rose.

Now, airlines are price-takers, not price-setters. What does this mean? They respond to what consumers are willing to pay … they don’t set the tone for the market (e.g., the way a luxury goods manufacturer would). So, if fares are shooting up year over year, a consumer willingness to pay is certainly implied.

Individual airline fare increases are pretty interesting, with United Airlines up 25 percent on average for is period and discounter Southwest adding 15 percent, on average, to every ticket.

According to USA Today, airfares are climbing for three reasons:1. Tension between capacity and demand: during the recession, airlines cut capacity in an effort to lower operating expenses and keep their margins from getting throttled. Available seat miles plunged more than 12 percent from the fourth quarter of 2007 through the end of 2009, according to the Air Transport Association. But, travelers are coming back. Demand is up, and there isn’t as much supply on hand. That pushes prices higher, even as airlines scramble to add capacity. Yet, available seat miles are up only 1.5 percent over the past year.

Why?

Airlines have been burned by market forces before when adding capacity too quickly. USA Today explains:

Having learned a bitter lesson by adding back too much capacity, airlines are exercising greater caution and restraint this time around. Additionally, bankruptcies and consolidations during the past few years helped contain capacity. Brands like Aloha, EOS, MAXjet, Midwest, Northwest, Skybus and ATA Airlines have disappeared as a result of consolidation or financial calamity and AirTran and Continental Airlines will soon follow suit.

2. Oil won’t go down: oil has been on the rise for a decade, moving from below $20 a barrel to above $90 a barrel, some of which came from the 2008 market shock. Someone has to pay for this of course … and it isn’t necessarily you. That’s the problem with being a price-taker: you can’t pass along all your expected or unexpected price increases to consumers. Now that market pressures are being eased, airlines can start to recapture some of these expenses.

3. The business is changing: according to USA Today, “so called ‘low-cost’ airlines look more like network airlines every day” – as a result of carrier merger activity. And, the increase in maturity comes with higher expenses. For example, these airlines are “rapidly expanding into larger hub airports or building their own”: that cost cash. It has to come from somewhere. It can also come with long-term costs that aren’t always easy to forecast:

Hub airports are often plagued with congestion, resulting in increased flight delays which can wreak havoc on aircraft turnaround times and utilization schedules, further raising operating costs. In recent years, Southwest has expanded into some of the most congested airports in the country, like Boston Logan, New York LaGuardia and Washington Reagan National.

4. There’s more to spend: the fact that there are expense pressures on airlines doesn’t mean that you’re going to have to foot the bill. The oil price factor, for example, has been around for a while, and it wasn’t enough to protect carriers from price declines. The fact that you probably have more discretionary income – or at least less perceived employment risk – means that you aren’t going to wince when you see a higher price. You’ll book with less lead time. It’s easier for you to spend.

What will be interesting to see is the extent to which consumers will be more willing to open their wallets. Even though having more cash comes with a bit of comfort in using it, memories may not be as short following this recession as they were in previous economic downturns. The recession kicked off by the global financial crisis in 2008 hurt. A lot. Unemployment was severe – and continues to be. People may not be as willing to pay big fares as they were in the past. Does this leave more market opportunities for online discounts – such as those offered by online travel agencies? That remains to be seen.

What do you think? Leave a comment to let us know! There’s no crystal ball on this one, and I’d love to get your thoughts.

[photo by atomic taco via Flickr]

Dog bites passenger and flight attendant, forces US Airways landing in Pittsburgh

by Tom Johansmeyer on

Mandy is one tough bitch.

On US Airways Flight 522 from Newark to Phoenix, this 12-pound Manchester terrier busted out of its cage. You would have too … if the drugs had worn off. With no more sedatives in her system, Mandy bit a man sitting next to her 89-year-old owner. Then, the dog shot up and down the aisle, also biting a flight attendant, according to the NY Post.

As a result of this mutt’s mayhem, an emergency landing in Pittsburgh became necessary. Mandy and her owner didn’t get back on, though. They were moved to a different flight.

[photo by crossfirecw via Flickr]

Bowermaster’s Adventures — Crossing the Atlantic with “Atlantic”

by Jon Bowermaster on

The Atlantic Ocean, 480 miles southwest of Lisbon – The seas have laid down to a meter in the past 24 hours and (for the moment) the sun is filtering through a gathering cloud layer. We have just sailed south of the Madeira Islands, destination (slowly) Puerto Rico. It should take another ten days or so.

Of all the places I’ve traveled this is my favorite place to be: In the blue heart of an ocean, surrounded by nothing but sea and horizon, eyes locked on that place where blue meets blue. It could be the center of the Pacific or Indian, the Arctic or Southern, any ocean will do. Today, it’s the Atlantic.

Thinking on my feet as I ran through the airport I grabbed a copy of Simon Winchester’s new book called simply … “Atlantic.” (Its subtitle elaborates: “Great Sea Battles, Heroic Discoveries, Titanic Storms and a Vast Ocean of a Million Stories.”)

When I first heard of the project – the biography of an ocean? – it sounded quixotic. Now that I’ve paged through it, surrounded on all sides by the very same ocean Winchester describes, I’d use the word “unique.”

It’s a challenging task to try and wrestle such a vast, constantly changing place into even 500 pages. There’s geography to consider, all that human exploration and exploitation, the development of trade and slave routes, dozens of wars and the commerce that inevitably followed, by sea and air. Thankfully towards the end of the book Winchester manages to devote about a tenth of his research to man’s impact on the Atlantic, starting with the raping of the cod fisheries off New Zealand right up to the way ocean acidification is today altering its equatorial reefs.”The oceans are under inadvertent attack, and as never before,” he writes. “Insofar as the Atlantic Ocean is the most used, traversed and plundered of all oceans, so it is the body of water that is currently most threatened.”

He admits the Pacific has been heavily hit by similar abuses, but is convinced the Atlantic is in “greater trouble,” in part because it is so much smaller than the Pacific, was the first to be explored, crossed by man and is by far the busiest. “It has become evidently the least pristine and most begrimed,” he concludes.

Winchester puts big responsibility for much of that grime on the trailings of jet planes and smokestacks of ships. One hundred million air passenger crisscross the Atlantic each year leaving behind jet trails of kerosene, a heavy contributor to the carbon dioxide in the atmosphere. One stat is most telling: A fully loaded, 300 passenger Boeing 777 flying from London to New York spews 70 tons of carbon dioxide into the sky or about 2,000 pounds per person.

Ships leave behind a similar trail. Winchester quotes a 2007 report by BP and a German physics institute which says that the funnels of the world’s entire fleet of 70,000 fuel-burning cargo and passenger ships pour more carbon dioxide into the atmosphere than is currently produced by all of the nations of Africa combined. Half of that commerce takes place along the coastlines of the Atlantic.

One downside to the carbon dioxide created by ships –sulfur-laden soot and other particles created by the fossil-fuel burning exhaust — is that it creates its own low-level clouds that linger in the atmosphere for weeks and months. They are so dense they can be seen from space, from which they are called simply “ship tracks.”

(The biggest container ship afloat? The Danish Emma Maersk, which weighs 170,000 tons and carries 15,000 containers.)

Cleaner fuels will help slow the pollution, as might giant sails (computer-controlled, already in the experimental stages). Yet for now, Winchester concludes, “the degradation of the air above our ocean … is just one more of the egregious examples of modern man’s weary disregard for a sea he once revered.”

I put the book down on that note, agreeing with most of his conclusions, actually wishing there’d been more specifics about future options for transport of both cargo and man across the seas. But it is a heavy task to biography an ocean; not everything can be included.

Standing on the rail of my ship, ignoring for the moment the contribution it too is making to the ship tracks, looking out at the horizon line – where from this vantage, everything still looks quite pristine — I wonder to myself even as we gain more and more knowledge about the ways man impacts the ocean, do we really think there will come a day when we stop taking it for granted.

Flickr image via Patrick McConahay

Gadling’s favorite destinations for 2011

by Alex Robertson Textor on

We travel a lot, to destinations both well-known and unfamiliar. In our defense, it is our job to travel like mad, to explore the world and then write about our discoveries.

Though most travel writers find something or other of interest in most places we visit, there are always those personal favorites that rise above the rest. This year, we decided to scribble our favorites down for you. Some of these spots we’re tipping for greater coverage in 2011, while others are simply tried-and-true favorites that we can’t stop raving about to our friends and the various publications that allow us to write for them. Over the course of this week, we’ll weigh in on our favorite hotels, airlines, gadgets, apps, and websites.

So, without further ado: Gadling’s favorite destinations for 2011.

Mike Barish. St. Kitts. I genuinely enjoy how locals and visitors frequent the same beach bars and restaurants. During evenings on the strip, I’d recognize staff members from my hotel doing the same thing I was doing: enjoying the ocean breeze with a cocktail and some jerk chicken.

Kraig Becker. Everest Base Camp, Nepal. For adventure travelers, a visit to Everest Base Camp is one of the best treks in the world. The 12-day hike isn’t just about the destination, however, as you walk in the shadow of the Himalaya each day, passing through sleepy mountain villages steeped in Sherpa culture along the way. The scenery, and altitude, is a breathtaking once-in-a-lifetime adventure.
Catherine Bodry: Ko Chang, Thailand and Sayulita, Mexico.

Joel Bullock: My favorite new roller coaster of 2010 is Carowinds’ Intimidator. Carowinds is located on the border of North and South Carolina in Charlotte in the heart of NASCAR country. It was only fitting that the park design a racing-themed roller coaster that bears the nickname of racing legend Dale Earnhadt. Intimidator is an exciting ride. It’s the tallest, fastest, and longest roller coaster in the South East.

David Downie: As a general trend, I revisit places that have fallen off the tourist maps, or that have been taken for granted, and delve deeper into favorite destinations such as Paris and Rome, which are infinitely rich and fascinating and satisfying. Cities: Paris (art, culture, walks, museums, food, wine), Rome (art, culture, walks, museums, food, wine), Genoa (food, wine, scenic beauty, history, magically restored architecture), Bologna (food, food, food and atmosphere and architecture), Helsinki (scenic beauty, atmosphere, seafood). Countryside destinations: Burgundy (wine, food, vineyard and mountain scenery), Massif Central (hikes, scenery), Drome-Provencal (ditto, plus truffles and wine), Tuscany (art, culture, museums, wine, food, vineyard and mountain scenery), Italian Riviera (ditto).

Don George. (1) Peru‘s Sacred Valley. I finally made it there this year and was enchanted by scenery, history, culture, people, cuisine. Machu Picchu is of course life-transformingly amazing but the other untouted ruins all around the valley are equally amazing. (2) Kyoto, Japan. The cobbled back quarters of this ancient city are as enchanting now as they were when I first visited 30 years ago. Tiny temples, impromptu shakuhachi concerts, apprentice geisha in full splendor. (3) Aitutaki, Cook Islands. Incredible island scenery, hospitable people, stunning lagoon, peaceful and laid-back lifestyle, thriving dance, carving, and textile arts scene.

Tom Johansmeyer. If you’re a cigar smoker, nothing beats Esteli, Nicaragua. On just about any budget, you can spend a few days down there. Make a few calls in advance, and you’ll have the opportunity to tour tobacco fields and cigar factories. Even if you aren’t a smoker, it’s amazing to see such craftsmanship in action.

Jeremy Kressmann. Hanoi, Vietnam for its great history and architecture, awesome cuisine, and intriguing Cold War sights. Secondly, Laos. The rugged north of the country has great hikes and the buzzing cultural capital of Luang Prabang is totally worthwhile.

Grant Martin. Bogotá. Forget what you’ve heard about kidnappings, drugs and danger, Bogotá is the new cosmopolitan capital of South America. With quaint, brick streets, a buzzing commercial district and a hip, young population, there’s not much to dislike about this place. Get there before the rest of North America figures it out.

Melanie Nayer. Shanghai. The city of old and new hit a turning point when it hosted the World Expo, and set the stage for Shanghai to become one of the most talked about–and visited–cities in the world.

Sean McLachlan. Ethiopia. Friendly people, rugged scenery, historic sites, and great coffee. What more could you want? Beautiful women, good food, adventure travel? Ethiopia has all that too.

Laurel Miller. Ecuador, especially Cotopaxi National Park (see above), because it’s stunningly beautiful, uncrowded, and there are loads of outdoor recreational opportunities. Ecuador is an amazingly diverse country, kind of like a mini-Peru but with very low-key tourism. There’s also great whitewater rafting/kayaking and mountaineering, fascinating indigenous culture, beautiful colonial cities, delicious regional foods, and the people are wonderful. There’s so much more to Ecuador than just the (admittedly spectacular) Galapagos.

Meg Nesterov. Bulgaria is cheap, creative, and easy to explore. Several of my most well-traveled friends already rave about it. Go now before tourism overexposes the country.

Heather Poole. Positano, Italy. It’s just so beautiful and the food is amazing. I’m a flight attendant and I have a four year-old son, as well as a husband who travels over 100,000 miles a year for business. Our life is like a game of tag. So when it comes to vacations all we want to do is relax. I love to be able to sit on a balcony and let the vacation come to me.

McLean Robbins. Telluride. It’s not new, but as ski towns go it feels non-commercial and relatively untouched. You’ll find truly friendly people (and your fair share of under-the-radar celebrities), but also the country’s best extreme skiing. And it looks like heaven when it snows!

Annie Scott. I’m big on Vienna. It’s a magical city that embodies everything I think of when I think of Europe: culture, history, cathedrals and class. I think the Swiss Riviera may be the most beautiful place I’ve ever been. Lake Geneva looks so pristine you could drink it, and the French influence gives everything from the dining to the shopping that elusive je ne sais quoi. Lastly, I had a marvelous trip this year in Zambia where the wildlife was rampant and the scenery was enchanting and unexpectedly dynamic: sweeping plains, dreamlike riverscapes and incredible trees. The thrill of being immersed in the bush is hard to match.

Alex Robertson Textor. Lima, Peru continues to pop. While the Inca Trail is old hat, Lima is emerging as a major destination on its own. Perhaps most notable is the Peruvian capital’s excellent restaurant scene, which is as disarmingly inexpensive as it is top-notch. I also have to mention green, rustic, jaw-droppingly beautiful Dominica as the Caribbean’s top adventure destination. Dominica has a number of fantastic eco-lodges that showcase the island’s natural beauty wonderfully and are priced reasonably.

Karen Walrond. As a diver, I love Cayman. Love it. Very touristy, but the diving is beyond anything I’ve seen, and i’ve been diving all over the world. And I’m partial to Grand Riviere in my homeland of Trinidad, which isn’t touristy at all. Between April and June, you can see Giant Leatherback turtles nesting in Grand Riviere.

[Image: Flickr | alepheli]

Mexico to become “champion” of adventure travel?

by Kraig Becker on

Speaking at the United Nation’s Convention on Climate Change yesterday, Mexican President Felipe Calderón recognized the importance of tourism and adventure travel for preserving the habitats and culture of his country, even going so far as to say “Mexico has to become the champion of adventure travel.”

The presentation took place as part of Green Solutions@COP16, which is an event that is focused on finding eco-friendly methods for building an emerging economy in the 21st century. The keynote address for the conference was given by Shannon Stowell, who heads the Adventure Travel Trade Assocation. President Calderón, along with his Secretary of Tourism, Gloria Guevara, also spoke discussing how adventure tourism can be an important piece for countries to not only grow economically, but also protect their natural resources, wildlife, and cultures in the process.

So, is Mexico the next great adventure destination? It certainly has plenty of amazing options for travelers looking to get away from the resort crowd and have a challenging and adventurous escape. For example, Baja offers great sea kayaking and surfing options, while the valleys near Oaxaca are great for mountain biking. High altitude enthusiasts can challenge themselves on Mt. Orizaba, an 18,491-foot tall stratovolcano that is the third highest peak in North America, while SCUBA divers and snorkelers will find plenty to love along the country’s more than 6000 miles of coastline. Additionally, there are caves to explore, trails to hike, and ancient cultures to discover as well.

Adventure travelers tend to be eco-friendly, always on the look out for an exciting new place to visit, and are willing to spend their money. It seems like Mexico hoping to take a bigger piece of the adventure travel market pie in the months and years to come.

[Photo credit: Mg-k via WikiMedia]