Low Cost Carriers: Winners during the Recession
According to the World Travel Market Report for 2008, released by Euromonitor International, travel service providers operating in international markets such as those of Asia and the Middle East will likely enjoy a relatively good year compared to those whose markets are the United States and Europe.
With the nation facing one of the worst financial crises in decades, the impact on consumer spending can already be felt in the industry. Not only are the individuals and families tightening their belts but also companies, in terms of business travels.
The good news is that budget hotels and carriers will be able to grab a larger share of the market. The rest of the industry will have to come up with more affordable rates for their vacation deals.
A lot of travelers these days are actually downgrading in order to manage the high cost of travel. Most are always on the lookout for cheap ticket deals in order to enjoy considerable savings.
Although fuel prices have gone down considerably in the past month, a lot of major airlines have yet to recover from the losses incurred when fuel costs skyrocketed during the summer. Most of them are still imposing surcharges on their passengers for fuel, checked luggage and other amenities.
Travelers, who are trying to stick to their budgets, have resorted to traveling with just a carry-on luggage and bringing their own water, blanket and even earphones. In addition, most plan their vacation during off peak season and fly out on weekdays.
The problems in the travel industry simply mirror the economic situation of the country. Fresh from the collapse of large Wall Street companies and large inventory of foreclosure properties, it is not surprising that consumers are cutting back on their travels, with many opting for a “staycation” instead.
