AAA: Travel industry might see some light at the end of the tunnel this Labor Day

The struggling travel industry may be seeing some light at the end of the tunnel.

More than 39 million Americans will be traveling on vacation — at least 50 miles from home — this Labor Day weekend, slightly more than the 37.1 million who traveled on the Fourth of July weekend, according to AAA. July Fourth is typically the busiest automobile travel holiday of the year.

“That is good news for the travel industry,” said AAA spokesman Geoff Sundstrom. “It means that the number of people traveling is gaining momentum as we close out the summer driving season.”

Robert L. Darbelnet, AAA president and CEO, also called the numbers “a positive sign.”

But the travel industry still faces challenges ahead. The number of Americans predicted to travel Labor Day weekend is expected to dip 13.3 percent from 2008. The recession has caused many travelers to pinch spending for leisure travel, Sundstrom said.

Labor Day falls on September 7, nearly a week later than last year. This later date may influence some families to skip holiday traveling because school already has started for their children, Sundstrom said.

AAA also attributes the expected drop to the fact that last year’s Labor Day travel was unusually robust because gas prices had dropped to $3.68 per gallon after an all-time record high of $4.11 per gallon last July. Last year many families scrapped their summer vacation plans and took them later in the year.

About 84 percent of travel on Labor Day will be by automobile, according to AAA. Gas prices this year are at about $2.60 per gallon, about a dollar cheaper than a year ago.

Travelers going by air will find that ticket prices have dropped nearly 17 percent compared with a year ago, AAA says.

Airlines have faced pressure to lower prices and cut capacity since the recession began. Some airlines are touting deals under $100 for a round-trip ticket, but industry experts said airline travel will take longer to recover than that by automobile.

Travel providers to popular destinations such as Hawaii, Mexico and Las Vegas, Nevada, have slashed hotel and airline prices while adding upgrades and dining credits. For months, airline and travel experts have encouraged travelers to snatch up deals before the economy recovers and prices climb.

Travelers looking for somewhere to stay on Labor Day weekend will find good news for their wallets. Hotel rates for AAA three-diamond and two-diamond lodging fell 12 percent compared with last year. Travelers staying at a three-diamond property can expect to pay an average of $137 for each night, according to AAA.

AAA rates lodging and restaurants on a scale of one to five diamonds, with one meeting basic standards and five ranked as premier places.

Overall, AAA expects travelers to spend $938 per household on their Labor Day weekend vacation.