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Gas Prices Hold Steady as Holiday Travel Picks Up

Big Price Hikes for Air Fares, Hotels, Rental Cars

By Joe Benton
ConsumerAffairs.com

November 21, 2006

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Holiday travelers face higher prices for hotel rooms, rental cars and airfares but gasoline prices will remain fairly steady despite dwindling stockpiles and reports of more cutbacks in crude oil production.

AAA estimates that 38.3 million Americans will travel 50 miles or more from home this holiday, a 2.7 percent increase from last year's 37.3 million travelers.

"Airports and highways will be busier than ever," said Gail Weinholzer, director of public affairs, AAA Minnesota/Iowa. "Higher prices for hotel rooms, rental cars and airfare have increased, but that will not keep people from traveling."

Approximately 31.7 million travelers (82.8 percent of all holiday travelers) expect to go by motor vehicle, a 2.6 percent increase from the 30.8 million who drove a year ago.

Gasoline prices facing travelers are virtually unchanged from the last week. Regular unleaded gasoline now sells for $2.23 a gallon. Midgrade is selling for $2.37 a gallon, and premium is selling for $2.46 a gallon.

"Americans will take advantage of the fact that gas prices have been falling for the past several months," said Dawn Duffy, manager of public relations, AAA Minneapolis. "They might have foregone the summer family vacations because of high gas prices, but extended family gatherings and lower gas prices will encourage Americans to get back on the road."

Despite paying less at the pump, travelers will face much higher prices for hotels, airfares and car rentals, according to AAA's Leisure Travel Index. Holiday hotel rates are up 16 percent as strong demand allows hoteliers to increase rates that they raised last Thanksgiving, too.

Expect higher rates for rental cars as well, with an average increase of 21 percent. With an average 4 percent increase from last year, air fares will be more costly, but travelers won't see the extreme price hikes they will experience with hotel and car rental rates.

AAA expects 4.8 million (12.5 percent of holiday travelers) Americans to travel by airplane, up 3.2 percent from the 4.6 million that flew last Thanksgiving holiday. A projected 1.9 million travelers (5 percent) will go by train, bus, or other mode of transportation, up slightly from 1.8 million a year ago.

The greatest number of Thanksgiving auto travelers will originate in the Southeast with 9.1 million, followed by the West, 7.2 million; Midwest, 6.7 million; the Great Lakes, 6.2 million; and the Northeast, 2.4 million.

The Southeast and the West are expected to produce the largest number of air travelers with 1.3 million each, followed by the Midwest with 789,000; the Northeast with 772,000; and Great Lakes with 643,000.

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