PRESS RELEASE

For Immediate Release
Contact: Debra Kelman 212-794-DKPR (3577)
dkelman@dkpr.com

The Travel Business Roundtable (TBR) Index Of Leading Economic Indicators Drops Sharply In April 2001

WASHINGTON, D.C. - June 13, 2001 -- The Travel Business Roundtable (TBR) Index of Leading Economic Indicators declined sharply in April - 2.2 percent. It was the sharpest seasonally adjusted monthly decline since the recessionary period of September 1991. Comparatively, the U.S. Index of Leading Economic Indicators increased fractionally - up 0.1 percent - the second monthly increase in the past seven months.

While the turnabout in the U.S. Index, albeit quite small, is a welcome development, the fall in the TBR Index was unexpected, particularly when judged against the strong 0.7 percent March increase. The TBR Index peaked in September 20000 at 140.1 percent since has declined 2.1 percent.

In reviewing the nine indicators that comprise the TBR Index, it appears that the weakness in the travel and tourism industry has been concentrated in three sectors: ARC (Total Travel Agent) Sales, ATA Revenue Passenger Miles and Consumer Confidence.

In five of the other remaining six, the April 2001 figures were above the September 2000 Index peak. The one exception was in Hotel/Motel Revenue, which was unchanged on a seasonally adjusted basis.

The 2.2 percent decline in the April index may be explained by sharp falls in two indicators: Consumer Confidence and Hotel/Motel Revenue.

The other two that were down were in ARC (Total Travel Agent) Sales and Hotel/Motel Occupancy Rate. In the remaining five sectors, the April figures were unchanged from March. These included: ATA Revenue Passenger Miles, Retail Sales at Eating and Drinking Establishments, Personal Consumption Expenditures for Travel and Related Items, Rental Car Revenue Per Day and Travel and Tourism Employment.

"In speaking with industry experts, they indicate that the sales weakness was concentrated in the business travel and convention areas, particularly at destination sites such as New York, Chicago and San Francisco," notes Dr. James Howell, Economist and President of the Boston-based Howell Group. "They were also hopeful that bookings in this industry sector will strengthen this fall." Dr. Howell added that it appears that leisure travel seems to be holding its own through the current cyclical adjustments, and that with the sharp turnabout in consumer confidence in May, this segment of the market appears more secure.

A closer look at the U.S. Index of Leading Economic Indicators shows increases in three of the 10 indicators that make up the Index. Of particular note is the increase in the S&P 500 Index. According to Dr. Howell, these increases seem to represent the Fed’s acknowledgement that the most direct way to improve consumer confidence is to shore up equity markets. This also leads to a conclusion that while restoration of robust growth may well be at least a year away, most of the worst in the 2000-2001 cyclical adjustment is now behind us.

The Travel Business Roundtable is a coalition of more than 60 CEO’s representing all sectors of the travel and tourism industry. In addition to the major airlines, car rental companies, travel management agencies, hotel chains, TBR’s membership roster also includes companies such as The Coca-Cola Company, USA Today, the Taubman Company, and the International Council of Shopping Centers, demonstrating the broad scope and diversity the industry represents. Projected to be the world’s largest industry within the decade, travel and tourism is the nation’s third largest retail industry and second largest employer with more than 17 million Americans employed directly or indirectly in travel and tourism.

Projected to be the world’s largest industry within the decade, travel and tourism is also America’s leading services export, travel and tourism created a trade surplus of nearly $17 billion in 2000, generating $93 billion of tax revenue and more than $550 billion in total expenditures.

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