Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, February 20, 1991 TAG: 9102200067
SECTION: BUSINESS PAGE: A-7 EDITION: METRO
SOURCE: DANIEL HOWES BUSINESS WRITER
DATELINE: LENGTH: Medium
The numbers are startling:
Travel Network in Salem saw about 80 percent of its European bookings for this year cancelled after Saddam Hussein's army invaded Kuwait.
Hopkins Travel Inc. in Roanoke has lost nearly 50 percent of its regular business travel because companies are vigilantly trimming unnecessary junkets.
McDade Travel Inc. of Roanoke, a self-described specialist in European and Asian travel, has seen a 45 percent drop in business from last year and has spent more time than usual altering travel plans for longtime clients.
Even if the Persian Gulf War ends soon and the economy begins to grow again in the second quarter, as many economists predict, 1991 likely will prove a devastating year for the travel industry. Indeed, some regional travel professionals say the downturn could force some smaller, less diversified and undercapitalized agencies to close their doors.
"We're not going to meet our projections for 1991, that's for sure, if it continues like this for the next couple of months," said Evelyn Eastland, manager of Travel Network.
"This is probably the worst recession the travel industry has ever experienced," David Cross, a consumer economist at The Futures Group in Washington, told The Wall Street Journal last week. "January and February could be the worst months on record."
Bill Thomas, owner of Hopkins Travel, said: "This is normally our busiest time of year. Nobody's planning anything. Everybody's sitting on the fence right now."
But - and it's a big but - there are real bargains out there. For example, cruise lines desperate for passengers are offering two-for-one deals in the Caribbean and Alaska, beneficiaries of the traveling public's flight from European vacations.
"It's a great time for the consumer," said Heinke McDade, president of McDade Travel. "People who are not afraid to fly have less-crowded airplanes and travel in more comfort."
More deals are on the way, predicted Ted Moomaw, president of World Travel Service Inc. He said airlines, hotels and cruise lines "will begin some promotional deals to fill some beds, berths and seats rather than see them go empty."
Air carriers pummelled first by skyrocketing oil prices and later by decreasing demand for international service have trimmed flights to some European destinations. But others hungry for dollars are still actively courting passengers, offering low fares when they can least afford them.
Still, Western Virginia travel agents say, a fear of terrorism seems to be keeping travelers home despite unprecedented security measures at international and domestic airports, including the Roanoke Regional Airport.
Many agents don't blame their clients for having the terrorism jitters. They say a trip abroad is probably not worth the investment if the client will spend the whole time worrying about safety. That's why they are pushing domestic alternatives.
"The war isn't the issue," said Mel Ludovici, president of Martin Travel Inc. in Roanoke. "The recession is the issue."
An uncertain economy in which white-collar workers seem to be taking as many lumps as their blue-collar counterparts has cut a wide swath from discretionary leisure travel, experts agree.
"This is not just doing a little bit of damage. The leisure traveler is basically staying at home," Moomaw said.
Meanwhile, corporate travel planners appear to be trimming avoidable trips, causing such firms as Martin Travel and World Travel to see a 10 percent reduction in corporate bookings.
State budget cuts also have dampened travel spending in Western Virginia. David MacTavish, manager of The Travel Co. in Blacksburg, said the rate of bookings for Tech faculty and administrators seems to have slowed in recent months, reflecting cutbacks that virtually eliminated travel from many departmental budgets.
by CNB