Is the travel industry losing its entry-level customers?
We hope not, but it could be the direction we're going if the industry starts trending toward a low-volume, high-price paradigm.
As we note in a news report on Page 1, a good bit of the buoyancy in today's travel market might be springing less from the desire of the masses to travel and more from the willingness of a few travelers to pay premium prices.
As the airlines have been demonstrating, keeping a lid on capacity is a good way to keep a floor under prices. It may also turn out to be a way to price some consumers out of the market altogether.
The no-frills seat in the back of the plane, the inside cruise cabin, the standard room in a three-star hotel, the three-night package -- these are the travel industry's entry-level Chevrolets. They whet the appetite for Buicks and Cadillacs, and while General Motors may no longer serve as a model for marketers, we believe the old analogy still works.
We hope that we're seeing the lingering effects of an uneven recovery rather than the beginnings of a full-scale tilt. If all this industry had to offer were Cadillacs, some of its customers would have to walk.