reiterates its May 2003 forecast that lodging occupancy will average 69 percent over the four-day Labor Day weekend, a 1.5 percent increase from 2002 Labor Day occupancy but less than 2001 levels. Urban and resort locations will experience the most significant occupancy gains as leisure travel volume continues to increase amid recent positive economic news, more normal weather conditions, and continued though refined discounting.
PricewaterhouseCoopers forecasts that U.S. lodging occupancy for the 2003 summer travel period of Memorial Day weekend through Labor Day weekend will average 67.7 percent, above the 2002 summer occupancy average of 67.5 percent but below the 68.7 percent average occupancy level achieved in 2001.
“As consumer confidence and the economic outlook have improved, as travelers have become more accustomed to security and travel inconvenience, and as airlines have increased capacity and extended lower fares, leisure travel has continued to be essential for improving lodging performance,” said Bjorn Hanson, Ph.D., global industry leader, PricewaterhouseCoopers Hospitality & Leisure Practice.
The beginning of the 2003 summer travel season was tempered by unusual weather conditions throughout much of the U.S., particularly in the Northeast. June 2003 ranked as the 6th coldest and 7th wettest June in the U.S. since 1895, according to the National Climatic Data Center. Precipitation in the Northeast was significantly above normal during June, and rainfall in New York City totaled over 250 millimeters, exceeding New York’s previous June monthly rainfall record set in 1903. Meanwhile, June 2003 U.S. lodging occupancy averaged 0.5 percent below 2002 levels and average daily room rate (ADR) averaged 1.3 percent below prior-year levels, according to Smith Travel Research.
During July 2003, lodging occupancy and rates improved compared to prior-year levels. Daily occupancy increased by an average of 1.2 percent compared to 2002, while daily room rates increased by an average of 0.5 percent during the same period, according to Smith Travel Research data. As forecast by PwC, occupancy during the 2003 July 4th weekend exceeded 2001 levels but was below that of 2002 due to the shorter duration of the holiday weekend for many.