Traffic to Vegas Staying Strong

Tourism experts say they don't expect rising gasoline prices to keep people from visiting Las Vegas despite a recent survey that suggested $3-a-gallon gas could curtail travel from Southern California.

Statistics from the first eight months of 2005, when the price of gasoline in California climbed an unprecedented 40 percent, say there are more cars on Interstate 15 to Nevada than ever.

The Energy Department said unleaded regular gasoline prices in California climbed from $1.98 a gallon in January to $2.77 a gallon in August. The Las Vegas Convention and Visitors Authority said traffic on I-15 at the Nevada-California border increased from 31,972 vehicles a day in January to 45,767 a day in August.

Highway traffic counters have no way of discerning local from interstate traffic, and some of the increase can be attributed to seasonal traffic patterns.

A survey conducted last month by the Las Vegas-based MRC Group Research Institute reported that 48 percent of the respondents said higher gasoline prices would deter them from planning vacations in Las Vegas, that 58 percent said fuel costs are affecting their decisions about vacations of five days or more and that 57 percent said fuel costs are affecting their decisions to go on weekend trips.

But given the track record of tourists adjusting their budgets to compensate for higher fuel costs and steady growth in visitation from other locations, local experts say Las Vegas tourism and the resulting gaming revenue it generates isn't going to dry up any time soon.

"It's (survey results) inconsistent with anything else we've ever seen as well as with our understanding of the market," said Jeremy Aguero of Applied Analysis, a Las Vegas company that studies local industry trends.

"The average consumer spends between $900 and $1,100 per trip," Aguero said. "If the cost of gasoline goes up from $50 to $100 a trip, that's a 5 percent increase on the total cost of the trip. An increase in one area that is going to shift consumer spending and have an acute impact on the destination is unrealistic and isn't consistent with what we've experienced."

Tourism leaders disputing the results of the MRC Group's survey said travelers would cut other costs and keep their travel plans.

"Are you really going to cancel the vacation because it costs you an extra 30 or 40 bucks round trip?" asked Kelly Ford, vice president of marketing for Travelzoo, an Internet media company based in New York.

"We've found that once gas hits a certain level, people adjust until the next spike comes along. Those percentages sound wildly off."

"Based on 30 years of research and following gas prices, it has never impacted Las Vegas visitor numbers," added Terry Jicinsky, senior vice president of marketing for the LVCVA.

Jicinsky also said many U.S. consumers do not view travel as a disposable expense.

"Much of the population view travel as a right," he said. "They would make adjustments to other parts of their expenditures before they gave up travel.

Jicinsky also said the survey assumed that Las Vegas casinos would do nothing if visitor numbers slipped, noting a current program in Primm that gives guests $25 in free gas if they are slot club members and stay at least two nights.

Despite the fact that gasoline prices have been high for many months, Jicinsky said year-to-date visitor volume is up 3 percent and convention attendance is up 12 percent, based on record figures posted in 2004.

"Las Vegas is on pace to have a banner year," he said., and resort executives agreed.

"We've seen steady increases in the price of gas for nearly a year now, and our experience shows that drive-in visitors from California and elsewhere are factoring the increased prices into their vacation budgets and continue to make the trip to Las Vegas," said Yvette Monet, a spokeswoman for MGM Mirage.

"Furthermore, the drive-in business from California represents an ever-decreasing percentage of overall business to Las Vegas. As the meeting and convention sector as well as the leisure sectors from the rest of the country continue to grow, a slight drop in drive-in business is less significant to our business profile and is easily offset by growth in other sectors."

Two front-line visitors concurred as they filled up their California license-plated vehicles at a Chevron station on Las Vegas Boulevard South.

"It is what it is," said Mike Williams of Fountain Valley, Calif. "The cost of gasoline isn't going to change any of my plans for coming here."

"In the grand scheme of things, it really hasn't made any difference," added Helen Crawford of Irvine, Calif. "This car is a rental, and I think it would only cost me about $10 more to fill it."

The MRC survey was based on a sample of 404 respondents interviewed between Sept. 10 and Sept. 25; it had a 4.9-percent margin of error.

The survey's author stands by its results. He said the results indicate that Las Vegas can no longer be complacent about how the price of gasoline affects local tourism.

"We have 90 percent of the people in Southern California saying that the gasoline crisis is impacting their budgets in some shape or form," said Jim Meddick, chief executive officer of MRC Group. "They say they have to cut back in some way, and that includes (eliminating) vacations of five days or more or some weekend excursions," he said.