Summer Vacations- Price Forecasts

Although we can never predict how prices of travel will vary from year to year, most forecasts are predicting higher prices for the summer of 2010 than the summer of 2009.

According to a USA Today article , they are suggesting to buy your summer airfare now and not wait for a sale that may not come. Domestically, the merger of Delta and Northwest has cut competition. All domestic carriers have cut capacity- most recently Southwest announcing a 4% cut in capacity. Internationally, British Air has cut flights from the NY/NJ airports to London by 23% and the British government has increased airport fees- both causing spikes in the prices of airfare. There may be some countries where prices are lower but the average summer airfares to Europe will be in the $1000+ range.

It’s all a matter of supply and demand. If there is more demand for a product, the price goes up. In the days of old, an airline would add another flight if there was enough demand. Now, the price just goes up and when the flight is sold out- you are out of luck.

In March, I booked 3 swim up suites in the adults only section of an all inclusive property in Punta Cana for a group of friends taking a 7 night vacation in mid August. Another couple booked a slightly lower room category (a junior suite with direct pool access) for the same time frame with the same airfare, etc for $100 per person less than the swim up suites. There were 2 more guests who wanted to join the group of friends but weren’t going to be able to deposit the vacation until the beginning of April. The original group paid just under $1775 per person for the hotel, transfers, airfare and travel insurance for their swim up suites and just under $1675 per person for the junior suites. When the last 2 guests were ready to book, just 3 weeks later, the same swim up suite with the same airfare and the same insurance and transfers, was $2033 per person. I offered them the junior suite as an alternative but that price was still $50 more than the other couple paid 3 weeks ago. Why the difference in price in just 3 weeks? Again, supply and demand play a roll. There are many less swim up suites available and when a few of them book up, the hotel feels that they can raise the rates of the other available ones. All of these clients included insurance that include price protection, so if prices do come down prior to their departure, I can get them reduced but there are no guarantees that the prices will come down.

Let’s talk a bit about cruises. Last month, I booked Barry and Judy on a 7 night cruise to Bermuda on the Celebrity Summit sailing from Bayonne on June 27. There was an unheard of New Jersey resident rate and their upgraded balcony cabin came in just over $3100 with taxes and fees. That same exact cabin is now $500 more, just 3 weeks later since Celebrity removed the NJ resident rate. It was such a hit, that Celebrity filled the number of cabins they wanted to at the reduced rate and now felt that they are able to sell the cabins for a higher fare. Will they end up with available cabins at the end and have to lower prices? It is likely but that last minute sale may very well come out as a balcony guarantee special where you can book a balcony cabin but not know your cabin # until the day of embarkation. You could end up with the cabin way forward (not a pleasant location for a Bermuda sailing) or you could end up with a great mid ship cabin. It’s a gamble but you could save some money.

In February, Ms. D. booked an interior cabin on the Norwegian Jewel for herself and her son sailing from NYC on June 26 to Florida and the Bahamas. Her friend was also sailing with her 2 sons and I was able to lock in 2 interior cabins close by each other- a double cabin for Ms. D and a triple cabin for Ms. F. Ms D. was paying just over $2000 for the 2 of them. Ms. F. was paying just over $2850 for her cabin for 3 guests. Just yesterday, Ms. D. called to ask if she can switch her cabin to hold 3 guests since her other son didn’t get the job he hoped for and now wanted to come on the cruise. Unfortunately, there were no interior or ocean view cabins for 3 guests left available so she had to go into a balcony cabin at an additional cost of $2000. Again, supply and demand was in effect. On April 2, NCL implemented a 7% price increase on their cruises since sales had picked up enormously since the beginning of the year. Ms. D. could have told her son that he couldn’t join them on the cruise at this time but NCL was betting that more guests will opt to go for the higher priced cabin to accommodate them, and in this case, they were right.

On the opposite note, last month, I was able to reduce prices for some clients on the June 23 and July 2 sailings of the Caribbean Princess sailing from New York. Those prices were limited to past guests and select categories of cabins but I was able to save my clients up to $500 per cabin.
Are there vacation bargains out there? Yes, and I can certainly help you find them but don’t think you’ll be able to take a 12 night Alaska cruise tour this summer for $1200 for an ocean view cabin. The distress sales of 2009 are on their way out!

If you haven’t booked your summer vacation yet- what are you waiting for? Give us a call or send us an email so we can help you plan your next vacation!

Looking forward to sending you away very soon!