Travel&Vacation

An economy in turmoil, overseas unrest, increased concerns about carbon footprints—overall, this is about the worst time I can remember to try to figure out what to expect in the coming year. Still, my position as a travel columnist demands that I at least try, so here goes.

Lots of Deals: At least for now, and probably through 2009, the cost pressures resulting from high oil prices are behind us. Meanwhile, consumer demand and industry economic levels are still heading down, not up, with no real turnaround yet in sight. The result: Travel suppliers will be hurting for customers, and their traditional approach will be to offer deals. As usual, they’ll try to do as much as they can with various promotional bundles rather than out-and-out price cuts, but you can expect plenty of those as well. Again, as usual, purchase windows will be relatively short. More than ever, the best prices will be for last-minute deals. Flexibility will remain the key to the lowest costs.

Nickel-and-Diming Forever: Maybe we should change the cliche to “quarter-and-dollaring,” but whatever you call it, you’ll see a lot more extra fees and charges for services that you would normally consider part of the base price. Most big airlines around the world have already discovered the wonderful world of unbundling, and you can expect other elements of the travel industry to follow suit. The idea, of course, is to increase revenues while keeping promoted list prices low, and as long as that strategy works, it will expand in the marketplace.

More Destination Problems: This is just a gut feeling, but it seems to me that the worldwide economic crunch is going to increase pressures on disaffected civilian populations worldwide. Any group that feels oppressed, for whatever reason, is going to be more likely to erupt. That’s why I expect to see more outbreaks of violence and unrest in places normally considered stable for tourists. In 2008, it happened in Greece, India, and Thailand. I can’t begin to predict where 2009 outbreaks will occur, just that they probably will. Keep a close eye on your newspaper and news channels, and buy travel insurance any time you have to put a big deposit up front for accommodations or transportation.

More Piracy: The ease with which pirates off the coast of Somalia have taken even large ships might encourage thugs in other parts of the world—Southeast Asia, most likely—to try their hand at one of the world’s oldest travel threats. The outlook depends on how effectively developed nations can mount a police action to counter the threat. So far, the results in Somalia are not encouraging.

Nontraditional Accommodations: Although airfares garner most of the publicity, hotel costs remain an increasing share of most travelers’ budgets. That means big gains in nontraditional accommodations that can offer lower destination costs. Of course, the very lowest cost is free, and I expect significantly greater use of home exchange programs. Vacation rentals should also do well, compared with mid- and high-priced hotels.

Downmarket: Given a crunch in overall household budgets, most travelers, I think, would rather go downmarket than curtail their travel. Luxury to mid-price, mid-price to budget, whatever starting place, most of us can move down a notch or two without serious sacrifice, and many of us will.

Vanishing Senior Discounts: Real senior discounts, already an endangered species, will remain both scarce and marginal. I don’t see Southwest abandoning its unique program of senior airfares, but I also expect its fares for travelers of any age to undercut the senior prices substantially. Those two dozen or so hotel chains that offer AARP hotel discounts will continue to do so, but they’ll become increasingly marginal, compared with promotions available to travelers of any age.

Opaque Looks Good: Given the industry’s crunch, opaque sites such as Hotwire and Priceline should continue to obtain plenty of distress-priced hotel and airline inventory. And as the economic crunch tightens, more and more consumers will figure that brand name isn’t all that important.