Gas Prices Aside, Americans Have Been Hitting the Road Again

driving family vacation
driving family vacation

The United States of America has about 4 million miles of roads, and we're a nation that loves to drive -- almost three-quarters of us do our summer vacation traveling by car. Our drive to drive, though, has been challenged in recent years by the soaring price of gas as well as by a stuttering economy that has left many people out of work or stretching budgets to make ends meet. Thus, it may be a bit of a surprise to learn that, according to the Chase Freedom Lifestyle Index, our spending on road trips seems to be rising.

The index, based on aggregated spending data from Chase Freedom credit cards, reveals that overall travel spending has remained relatively flat between 2011 and 2012, but road-trip spending has gone up. In the second quarter of 2012, the average road trip's cost (including gas, fast food, hotel stays, car rental, and tolls) totaled $367, up 3% over year-ago levels. The increase was even higher -- 8% -- over the previous quarter, but that makes sense as the second quarter features warmer weather and the beginning of summer.

Here are a few more noteworthy details from the study:

  • Men spend more. The average man's road trip costs almost 45% more than that of the average woman ($438 vs. $303).

  • 35-to-44-year-olds spent the most (averaging $449), while those 65 and older spent the least ($269).

  • The highest-cost road trips were in South Dakota, Wisconsin, and Indiana, while the states seeing the biggest increases in road-trip spending were Arizona, Florida, and Illinois.

  • On a year-over-year basis, spending was essentially flat on gas and car rentals, and up just 4% for hotels. But fast-food spending surged 17%, and tolls 29%.

Mysteries Solved

Some of the above can be easily explained. Younger people spending more than older people makes sense, as people ages 35 to 44 are generally in the prime of their working lives, while many of those 65 or older are retired and living on lower incomes.

The big jump in toll spending isn't surprising, either, as many states and other regions, strapped for cash in this tough economy, have been raising toll rates or proposing to do so. Last year, the Delaware River Joint Toll Bridge Commission hiked tolls by 33% for cars, while the Pennsylvania Turnpike upped cash tolls for cars by 10% (leaving E-ZPass rates unchanged). The Maine Turnpike is proposing upping its rates by an average of 25%. Some tolls in the Northeast have jumped so much that the federal Government Accountability Office is investigating them.

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The increase in fast-food spending might be explained by consumers embracing new menu items, such as Burger King's (BKW) new chicken strips and caramel coffee frappes, which compete with similar fare at McDonald's (MCD). A different, and perhaps more likely explanation, though, is that since so many are still struggling in our sputtering economy, more folks are choosing to dine at lower-cost fast-food venues instead of more upscale eateries.

It's also worth remembering that this data reflects the habits of credit card users, not all Americans. However, that still reflects a wide cross-section of America, as recent data shows that last year, only 27% of all point-of-sale purchases were made with cash, and the cash-usage rate is dropping. (Paper checks are disappearing even faster, with only about 7% of purchases last year made by check.)

Promising News

Increased spending on road trips bodes well for the American economy, as hotels, restaurants, and gift shops will likely see their coffers swell. Chase's data is supported by other studies, too, such as one by TripAdvisor (TRIP) that found fully 86% of Americans were planning a trip this summer, up from 81% a year ago. Also, 21% would be willing to drive 10 hours or more if they'd save on airfare that way.

Overall, our great American travel picture makes sense: We want to travel, we're eager to travel by car, and we'll find ways to save money where we can, whether it's driving instead of flying or eating at less expensive establishments.


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Longtime Motley Fool contributor Selena Maranjian, whom you can follow on Twitter, owns shares of McDonald's, but she holds no other position in any company mentioned. Click here to see her holdings and a short bio. The Motley Fool owns shares of TripAdvisor and McDonald's. Motley Fool newsletter services have recommended buying shares of McDonald's and TripAdvisor.