While travel is up in the U.S. compared to July 2010, high gas prices and a stagnant economy have limousine companies and car services seeing mixed returns.
According to the U.S. Energy Information Administration, the average price for a gallon of regular-grade gas is up by 92 cents nationally from July 2010. In New York the average gallon of gas costs $3.89, an increase of 97 cents from last summer, and in New England the average gallon of gas costs $3.76, up more than a dollar from last summer.
Vince Vitti, owner of Michael”™s Limousine in Greenwich, Conn., which has some 30 vehicles, said increased gas prices coupled with more cautious spending has resulted in a drop in his company”™s business across the board.
“Airport, point to point, corporate ”“ they”™re pretty much all down,” Vitti said. “You can see a lot of people are being tight with money. We”™ve definitely decreased, that”™s for sure.”
He said he thought his competitors weren”™t faring any better, noting he had unemployed drivers in every day looking for work.
“Some (businesses) have 10 or 12 cars and they”™re actually cutting cars,” Vitti said. “Every day I get people calling, asking for work.”
At Red Oak Transportation in White Plains, owner Andy Stoppelmann said the company”™s overall business is up but it has seen a marked drop in leisure travelers and families going on vacations.
Stoppelmann said roughly 85 percent of the company”™s clients are related to corporate ground transportation, both to and from the airport and from business to business.
“We”™re actually seeing increased business over the last year, so gasoline hasn”™t really played that much of a part in the up or downturn of the business,” he said.
When it comes to vacationers, Stoppelmann said that aspect of Red Oak”™s business is down for the year, which he attributed, like Vitti, to the slow economy.
“I truly believe that people are doing a lot more stay-cations than vacations and I believe that”™s the result of the overall economy,” he said.
Both Red Oak and Michael”™s Limousine have taken measures to combat the slowdown in business, including dropping prices for the summer, promoting corporate deals and adding a fuel surcharge.
“We had to institute a gas surcharge, which we hadn”™t for a long time,” Stoppelmann said, adding the company has a number of deals with local hotels and corporations.
Nationally, AAA estimated travel is up by approximately 5 percent from last summer.
“Overall, travel is up,” said Robert Sinclair, spokesman for AAA New York. “People are using air perhaps less overall but are travelling a lot more domestically.” He also said cruises have become very popular, due to low summer prices and the convenience of departures from New York City.
However, AAA expected travel was unchanged or was down for the Memorial Day and July 4 holiday weekends. It estimated 39 million Americans traveled at least 50 miles over the Independence Day weekend, a 2.5 percent decline from a year ago, and nearly 35 million Americans traveled at least 50 miles over the Memorial Day weekend, which would have been an increase of 0.2 percent from 2010.
For many families, every dollar makes a difference, Vitti said.
“For $5 less, they”™ll go to different companies because people are hurting,” Vitti said. “It”™s amazing how those $5, it hurts.”
Artical is right on, we have seen airport and other toursit related runs drop to almost nothing this summer, people are really scared to spend any extra money. Business trips in our area have also slowed down.
I’m dropping my prices $6 immediately. Thanks for the info.