04/23/2006

Gas prices shudder travelers, businesses

By Bill O'Brien

bobrien@record-eagle.com

Record-Eagle/
Douglas Tesner
Kristen Jongen says she won’t be making as many road trips with her Toyota 4-Runner because of rising gasoline costs.

TRAVERSE CITY — It was a phone call Roger Funkhouser doesn't like to receive: A six-night reservation in August wiped out by a downstate resident's worries over spiraling gasoline prices.

"It was a 'We've got to rethink our summer' type of thing," said Funkhouser, general manager of Bayshore Resort on Front Street in Traverse City. "I'm a little concerned right now ... it's starting to affect people psychologically. If people have to cut back, we're one of the areas they look at."

The cost of gas has soared to nearly $3 a gallon with no let-up in sight, and travelers and those who rely on the tourism industry are both weary and wary of pumped-up prices and profits.

Some said they'll travel less frequently this summer and spend less on their excursions, while those on the merchant side of things hope tourists will look past the gas pumps and the state's stalled economy.

Mike Luckas typically travels from his Novi home to his family's property near Maple City in Leelanau County at least four times a year. It will probably be three trips this year because of the high gas prices, he said, with fewer "excursions" when he gets here.

"When I go on vacation I go shopping, eat at restaurants," said Luckas, an electrician for Ford Motor Co. "Those things will be affected."

He expects to pay $100 to $150 in extra gas costs this year that can't be spent on other things.

"Those are gifts I could buy, or another couple dinners we could do," he said.

Chicago often beckons Kristen Jongen of Traverse City for summertime fun. But the pump raced past $40 while she filled her vehicle last week, and she said high gas prices already have curtailed her travel schedule.

"I'm definitely not as quick to jump in the car and take a road trip," Jongen said.

Tourism industry officials often try to temper the impact of gas prices on the travel business, and say high gas costs can lead to locals sticking closer to home for vacations. But the travel industry closely monitors fuel costs and officials acknowledge energy costs are a factor when travel plans are made.

"It's hard to say high gas prices can work to our advantage," said Brad VanDommelen, head of the Traverse City Convention and Visitors Bureau. "It's certainly not what we want to see."

Others are more worried about the state's ongoing economic problems. Shirley Piepenburg said visitors to her Deer Lake Bed & Breakfast near Boyne City might squawk about gas prices, but are more concerned about their livelihoods as many travel from southeast Michigan.

"It's their actual work; they hope they have a job in the future," she said. "I think that's more of a problem right now."

Gas prices and the economic woes in southern Michigan have made for a "tenuous" situation for the summer season, VanDommelen said.

"We're kind of in uncharted territory: record gas prices combined with a tough economy in Michigan right now," he said.

The Travel Industry Association of America produces a "travel price index" that tracks the cost of various travel-related expenses, including food and beverage prices, lodging costs and transportation expenses. Motor fuel costs are up nearly 24 percent in the past year, easily the largest single increase in the index, according to its latest national figures.

General transportation — gas prices, air travel and other public and private transportation costs — is up 16 percent. Food costs are up 3.1 percent and lodging is up 3.5 percent.

The association's overall travel price index is up 6 percent over last year.

Linda Casey, a spokeswoman for Marathon Ashland Petroleum that runs the local Speedway stations, said there are no signs of short-range relief in gas prices, with crude oil prices at record levels and oil futures running slightly higher. Demand also remains high and inventories have slipped in recent weeks even as motorists talk of driving less because of high gas prices.

"There are a lot of analysts out there who say most Americans don't care," Casey said.