News

1. Falling hotel rates

Yes, they're getting cheaper. As the recession encourages travellers to stay home, some North American hotels are marking rooms down - in New York, for instance, the luxury boutique Cooper Square Hotel opened this month with rates of just $275 (U.S.), well below the average New York rate in the fall. Other hotels are doing whatever they can to avoid price cuts, says hotel consultant Joel Rosen, chairman of Toronto-based Horwath HTL. Many are offering credits for food and beverage or hotel services, often worth $150 to $300 over three nights.

Outside Canada and the U.S., hotels are more desperate. A fall-off in U.S. travel has meant empty rooms for resorts in Mexico, the Dominican Republic and other sun destinations. To fill the gap, the properties are offering discounts to Canadian tour operators, says Moscou Côté, vice-chair of the Association of Canadian Travel Agencies. As a result, he says, this year's winter vacation packages are priced an average 20 per cent lower than last season's.

In Dublin, things are so bad that a number of luxury hotels, including the landmark Shelbourne, have been offering three nights for the price of two. And in London, Supranational Hotels managing director Niels Pedersen predicted recently that hotel prices won't rise above last year's levels until 2013.

2. Cheaper airfares

The average price of an air ticket could drop 3 per cent next year, as the number of passengers drops 5 per cent. Those were the predictions of Brian Pearce, chief economist with the International Air Transport Association. He spoke in Geneva this month after a meeting of the 30 world airline bosses who sit on the IATA's board of governors.

Even though oil prices have dropped, the world's airlines expect to lose $2.5-billion (U.S.) next year, with only North American airlines expected to make even a token profit. Watch for more-frequent seat sales in 2009 as airlines try to stimulate advance bookings. Air Canada's unprecedented December sell-off, which offered discounts through until next November, could be a harbinger of fire sales to come.

3. Discounted cruises

Cruise lines, once the fastest-growing players in the travel industry, are now offering discount deals to fill empty cabins. There are widespread sell-offs at the moment on Caribbean sailings. In Britain, MSC Cruises recently offered a second cabin for $1.75 to anyone booking a Mediterranean cruise. Cruise giant Carnival Corp. told investors that the booking outlook for 2009 remains uncertain.

Look for bargains on the water in the coming months, especially with 15 ships making their maiden voyages. Among them is the largest cruise ship ever, Royal Caribbean's 5,400-passenger Oasis of the Seas. Among its offerings will be a levitating bar that ascends and descends through three levels, the first-ever carousel at sea, and "Central Park," an open-air tropical garden the length of a football field.

4. Easier airport security

Airport screening procedures could become less of a hassle in the coming months. Machines to scan liquids and gels in carry-on luggage are now in the trial stage. That would be the end of having to carry 100-millilitre containers in clear plastic bags.

Also on the horizon is one-stop security, meaning that once passengers clear security at one airport, they won't be checked again at a connecting airport. Canadians flying through Europe could be among the first to benefit, if Canada pushes for such procedures under the new Canada-Europe Open Skies agreement, says Georgina Graham, IATA's director of security and facilitation.

Meanwhile, Kelowna International and 10 U.S. airports are testing full-body scanners that show security agents what is under passengers' clothing. Transport Canada will decide in 2009 whether to expand use of the machines to other Canadian airports. They will probably be commonplace at European airports by 2010.

5. The beginnings of greener air travel

This could be the year that flying makes some real progress toward sustainability. Both Japan Airlines and Continental Airlines will conduct demonstration flights in January using bio-fuels made from plant sources.

Meanwhile, also next year, the Solar Impulse, a solar-powered aircraft being built in Switzerland, will make a test flight at night, when its only power will come from batteries charged during daylight. But don't expect its technology to be used on jumbo jets any time soon: The size and weight of the solar panels and battery means there's room on board only for the pilot.

6. More online bookings

The economy may mean fewer travellers in 2009, but a higher percentage than ever of those who go will research and book their trips on the Internet. That's the word from Carroll Rheem, director of research with PhoCusWright Inc., a company that does studies for the Canadian Tourism Commission.

Already, 42 to 44 per cent of all travel spending in Canada is made online, says Sean Shannon, managing director of Internet travel agency Expedia.ca. And according to David Redekop of the Conference Board of Canada, 83 per cent of Canadian travellers will research their winter trip online and 62 per cent plan to buy at least part of their outbound winter trip online.7. Thriving discount airlines

When fuel prices skyrocketed last summer, many observers predicted that a number of discount airlines wouldn't survive. But Ireland's Ryanair weathered the storm. Now the bare-bones carrier is considering flights from London and Dublin to airports near New York, Denver and Los Angeles, if it can find the right aircraft. Its proposed one-way economy fare - $13 (U.S.) - would likely touch off a price war on the North Atlantic. Ryanair is also bidding to take over Ireland's Aer Lingus. Michael O'Leary, Ryanair's cocky CEO, predicted recently that there will soon be only four European airlines: Ryanair, Lufthansa, Air France/KLM and British Airways.

8. Tighter rules at the border

The days of entering the United States by road with a birth certificate and a plea are coming to an end. When the current transition period ends June 1, Canadian citizens crossing the border by land or sea will need a passport, a Nexus or Fast card, or a newly issued driver's licence enhanced with radio-frequency technology. British Columbia is already issuing these on a trial basis and Ontario, Manitoba and Saskatchewan have plans to do so.

9. Inflight services

Internet access in the air will come to Canadian planes this year: Air Canada passengers will soon be able to send e-mail and surf the Net from their seats with a Wi-Fi-equipped laptop or personal electronic device. The service will make its debut on some flights to the U.S. West Coast in the spring and eventually be extended to all flights. Other North American carriers trying similar services include Virgin America, American and Delta.

Meanwhile, one airline is preparing to install onboard urinals, possibly as early as next year, according to Norbert Runn of Dasell, a German cabin-design company. The units are intended to ease congestion at traditional washrooms.

10. Leaner airlines, and more charters

Canadians will get direct flights to a handful of new destinations next year, but over all the air travel trend will be to reduced choices of routings and flight times. In order to survive, airlines are cutting flights, parking fuel-guzzling airplanes and entering into mergers. (Lufthansa is bidding for Austrian Airlines, British Airways is in merger talks with Spain's Iberia, and additional U.S. mergers could follow this year's takeover of Northwest by Delta). Even so, the IATA predicts that some carriers won't make it.

For passengers, this will mean more crowded airplanes, fewer choices of departure time and fewer direct flights. Among recent cutbacks: Air Canada has replaced its non-stop Toronto-Tokyo flight with one that stops in Vancouver, and Malev has cancelled its flights from Toronto to

Budapest.

Over all, however, Canadian airlines are still in expansion mode. Air Canada will launch flights to Geneva from Toronto and Montreal and to Rome from Montreal in June. WestJet hopes to offer more U.S. destinations once its preliminary linkup with Southwest Airlines is expanded. And WestJet's partnership with international carriers through the Oneworld alliance means corporations can now book international travel at discounted rates.

Charter carrier Air Transat's plans for summer 2009 include new routes from Toronto and Montreal to Venice, from Toronto to Milan and Rome, and from Vancouver to Barcelona, Madrid and Rome. And Porter Airlines will increase Toronto-Chicago service to six flights daily in January.