Holiday bookings still strong, say airlines, and fares could increase

Minneapolis business manager Roque Rossetti plans to make his annual trip home to Sao Paulo, Brazil, for Christmas. The 35-year-old said the sagging economy gave him no second thoughts about shelling out $1,200 for the ticket.

"If I wait longer, I'd probably pay more, and I might not end up going," he said. But, he added, "I'm secure. I don't have kids or a wife. My house is paid for."

Several carriers have said that advance bookings show their planes are expected to be as full as or fuller than a year ago over the late fall and winter holidays — largely because they have taken so many seats out of the air, a decision that was made when fuel prices were soaring. In fact, travelers who have not booked flights for the holidays could find it more difficult and expensive than usual to find the flights they want, when they want them.

Because of the capacity cuts, fuller planes do not mean more people will be flying. It also may be tougher for ski resorts and sunny vacation destinations to keep their numbers up, though some are offering promotions to lure holiday travelers who may be hesitant to open their wallets amid an uncertain economy.

"I think the consumer now has a lot of things on their mind — they're concerned about the economy, they're concerned about the election, but I think they have already made the decision about what they are going to do over Thanksgiving and Christmas," said Arne Haak, chief financial officer of discount carrier AirTran Airways.

Haak said the carrier has not seen a slowdown in bookings over the holidays.

"In fact, Christmas looks very, very good," he said.

The picture is similar at Atlanta-based Delta Air Lines, an executive said.

"I think it might be the newness of the information," Ed Bastian, Delta's chief financial officer, said of travelers' response to the economic crisis.

He said most consumers are still trying to figure out what the crisis means to them. Bastian said Delta's domestic advance bookings for the holidays show stronger occupancy rates on a year-over-year basis and are in line with the carrier's expectations, though he noted capacity cuts may be playing a role in that. On the international side, he said November-December occupancy rates based on advance bookings are down, though he noted Delta is increasing capacity on overseas flights.

At American Airlines, its occupancy rate based on advance bookings for the fourth quarter is down about 2 percentage points year-over-year, Chief Financial Officer Tom Horton said. That's "not outside of the norm you might see varying from year to year, but remember we are taking capacity out of the system," Horton said. The fourth quarter, which includes the holidays, is traditionally a slow period for airlines.

While he would not offer specifics for the holiday season itself, Horton suggested the carrier was not expecting a big drop-off in sales during the time period.

"I don't see anything unique to the holiday period right now," Horton said.

A big change may be that, with the economy suffering, people are looking for better deals. Some ski resorts are already suffering.

Ski.com, which books vacations at 80 resorts in the Western U.S., Canada, Europe and South America, has seen sales slip compared to last year, said spokesman Dan Sherman.

As of September, Vail Resorts Inc. Chief Executive Rob Katz said the number of Colorado season passes sold was down 8.4 percent. Advance lodging bookings through central reservations were down 17.7 percent in room nights over the same period last year.

Recently, the company announced a slate of new promotions, including offering a free night to guests who book a five-night stay or more on dates around Thanksgiving, Christmas, New Year's and other major holidays in 2009.

Andy Wirth, the chief marketing officer of resort owner Intrawest (which includes Whistler-Blackcomb in British Columbia), said consumers seem to be favoring ski destinations within driving distance this year, although he noted that airline capacity has held steady at the three airports that service its western resorts.

He is optimistic about a major marketing push planned for shortly after the election in November. "The destination skiing customer is a very resilient customer base," he said.

Kristin Jackson of Seattle Times Travel contributed to this report.