Two of the Three Major Summer Holidays Will Bring Modest Rebound in Summer Hotel Occupancy Due to Favorable Economic News and an Increase in Drive Travel - PricewaterhouseCoopers Reports

Memorial Day weekend occupancy is forecast to achieve 73 percent, a sequential improvement over the 72 percent occupancy in 2002 and 71 percent occupancy in 2001.

Labor Day weekend occupancies are forecast to increase by 1.5 percent over 2002 levels, to 69 percent, but will be below 2001 occupancy of 69.7 percent.

July Fourth weekend occupancy is forecast to be 72 percent, exceeding the 2001 occupancy of 70.8 percent, but below last year's occupancy of 73.4 percent when the holiday occurrence on a Thursday resulted in a longer weekend and more travel.

The summer season is forecast to achieve a 0.6 percent increase in hotel occupancy, to 68.1 percent. This occupancy level is only moderately below the 2001 summer occupancy of 68.7 percent, when travel did not face today's challenges presented by terrorism, military action, travel inconveniences and the economy.

The following graph shows that consumers will be travelling more by car as their shares of spending of personal disposable income (PDI) for air travel has fallen more than their spending on travel, although that has declined as well.

"Two of the three major weekend holidays will exceed prior year occupancies, and occupancy for the summer will be higher, providing good news for a change," said Bjorn Hanson, Ph.D., global industry leader, PricewaterhouseCoopers Hospitality & Leisure Practice.

Sources, PricewaterhouseCoopers based on Smith Travel Research data, U.S. Bureau of Economic Analysis, Air Transport Association (historical airline data), Federal Aviation Association (airline forecast data).