The Road to Recovery : Survey Finds Some Industries Rolling Along but Others Are Stalled : TOURISM
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When the nation’s cruise lines took out an advertising supplement in Time magazine this year, their timing couldn’t have been worse: The issue’s cover blared out “War in the Gulf,” complete with photos of U.S. bombers over Baghdad.
Few readers bought the “Choose to Cruise” message then, and the travel industry remains in bad shape now. Hotels, airlines and cruise businesses report little or no growth, despite massive price discounting and reports of an improving economy.
Airline traffic in May was even with a year ago, and the industry expects to report a loss for the second quarter. Already, big losses have forced Pan American World Airways, Continental Airlines and Midway Airlines into bankruptcy. Trans World Airlines and America West Airlines have suspended some debt payments.
And bad news for airlines is bad news for hotels, which depend on airlines to bring them customers. Omni Hotels, a Hampton, N.H.-based hotel management company, said reservations are up 6% to 8%, but room rates are flat. “If people don’t fly, they don’t come” to hotels, said Omni spokeswoman Stephanie Seacord.
The cruise industry reports a slightly different outlook, with bookings near normal, thanks to price cuts of 10% to 20%, and a decision to move half the European fleet closer to U.S. shores.
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