In April 2011, the average price of a gallon of unleaded regular gasoline was approaching $4.00. Almost seven in ten U.S. adults stated that rising gasoline prices would have a significant negative impact on their leisure travel behavior during the coming year. "Affordability of travel," as measured by MMGY Global and the U.S. Travel Association"s quarterly Traveler Sentiment IndexTM, plummeted from an indexed value of 118.2 in February 2011 to 66.9 in April 2011 (March 2007 = 100). And 57 percent of those planning to take a leisure trip using their personal vehicle said that if gasoline prices continued to rise they would give serious consideration to changing their travel plans – with fully one third stating they might actually cancel a leisure trip.

Now, one year later, the average price of unleaded regular (nationally) is approaching $4.00 a gallon once again, with fuel price prognosticators warning that the price at the pump could easily eclipse the all-time high of $4.11 (July 17, 2008), soaring to $5.00 a gallon by this summer as political turmoil in the Middle East threatens the flow of oil through the Strait of Hormuz.

Remarkably, the two April scenarios are essentially the same, albeit 12 months apart. What has changed, however, is Americans" perception of the impact a potential rise in the price of a gallon of gas will have on their future travel behavior. Once again, they have confirmed their resolute view that a vacation is a birth right. Whereas 57 percent of U.S. adults planning to take a leisure trip in April 2011 reported that the high price of gasoline would likely cause them to alter their "drive" leisure travel plans (using their personal vehicle), this number dropped to 44 percent in the April 2012 travelhorizonsTM survey. Although one third would still consider cancelling a trip if the price of gas were to spike, fewer would "drive a shorter distance from home" as a consequence. Fewer would also "cut back on spending for entertainment, dining out and shopping" to accommodate the increased price of fuel. The bottom line? Even with the specter of rising gas prices on the horizon, demand for leisure travel services this summer is looking up.

 

Survey Reveals Travelers Driving On, Despite Gas Prices— Source: MMGY Global/U.S. Travel Association travelhorizons(TM), April 2012Survey Reveals Travelers Driving On, Despite Gas Prices— Source: MMGY Global/U.S. Travel Association travelhorizons(TM), April 2012
Survey Reveals Travelers Driving On, Despite Gas Prices— Source: MMGY Global/U.S. Travel Association travelhorizons(TM), April 2012

QG1. Thinking about the price of gasoline per gallon where you live today, would an increase in the price of gasoline per gallon cause you to change your travel plans

Base: Renting a Car/ Traveling in a Personal Vehicle/Your own or rented RV

Although substantially fewer travelers are likely to change their "drive" travel plans due to the increased cost of gasoline compared to one year ago, the April 2012 travelhorizonsTM survey revealed that consumers are actually more sensitive to fluctuations in the price of a gallon of gas. Seven-out-of-ten said that an increase of $0.75 per gallon or less (based on the $3.90 per gallon they paid for their most recent fill up) would cause them to consider changing their "drive" travel plans – up from 50 percent in April 2011. Perhaps not surprisingly, the prospect of higher gasoline prices would not impact "drive" travel plans equally across all travelers. The likelihood of altering "drive" travel plans is highest among lower income households (55%), and declines to just over a third (36%) among households with an annual income over $100,000. Similarly, younger "drive" travelers are more likely than their older counterparts to consider changing their travel plans should the price of gas increase.

*Denotes statistically significant difference from under $30,000— Source: MMGY Global/U.S. Travel Association, travelhorizons?(TM), April 2012*Denotes statistically significant difference from under $30,000— Source: MMGY Global/U.S. Travel Association, travelhorizons?(TM), April 2012
*Denotes statistically significant difference from under $30,000— Source: MMGY Global/U.S. Travel Association, travelhorizons?(TM), April 2012

QG1. Thinking about the price of gasoline per gallon where you live today, would an increase in the price of gasoline per gallon cause you to change your travel plans. Base: Renting a Car/ Traveling in a Personal Vehicle/Your own or rented RV

Fortunately, as was also in the case in the spring of 2011, the record-breaking gas prices forecast this spring failed to materialize. In fact, rather than reaching stratospheric heights, the average price of a gallon of unleaded regular fell by $0.22 ($3.94 to $3.72) between April 17 and May 17 of this year,* making "drive" vacations even more affordable than the same time last year.

The recent decline in gas prices notwithstanding, the silver lining in what might otherwise be considered an ominous development for the travel industry this summer is evident: although any escalation in the price of a gallon of gas should not to be ignored either today or in the future, U.S. travelers appear much more likely to take this trend in stride, and much less likely to alter their "drive" travel plans as a result.

*Source: AAA Daily Fuel Gauge Report

About MMGY Global

MMGY Global is the world's leading integrated marketing firm specializing in the travel, hospitality and lifestyle industries. With operating brands across the world, the award-winning organization maintains a global communications practice in all marketing channels, serving many of the world's premier travel and tourism brands. As a company dedicated to the travel industry, MMGY Global strives to create a connected, inclusive and peaceful world by promoting travel as a cultural bridge of understanding. For more information, visit mmgyglobal.com.

Christie Gregovich
407-838-1822
MMGY Global