Operations

Booming Economy And Leisure Market Have Group Tours On The Rise

Posted on April 1, 1998 by LCT Staff - Also by this author

One of the fastest growing segments in the chauffeured transportation industry is the group tour industry. The National Tour Association (NTA), based in Lexington, KY, estimates that the number of people going on group tours in the United States has increased 22 percent in the past four years, from 20.8 million passengers in 1993 to 25.2 million passengers in 1996. These 25 million passengers were part of an estimated 625,000 tours within the United States.

Group tours include everything from 10-day tours of major league baseball stadiums to ski trips, gambling excursions, and a host of other leisure activities. The average motorcoach tour has 42 passengers who spend an average of $75 each, per day. The typical charter for a standard motorcoach ranges from $475 per day in smaller markets to more than $1,000 per day in larger markets, such as Chicago and Los Angeles.

Some motorcoaches can cost more than $800,000 and rent for up to $2,500 per day. Charlie Horky, owner of CLS Transportation in Los Angeles, New York, and Las Vegas, owns a motorcoach manufactured by Marathon Coach, headquartered in Coburg, OR. The company rents it to visiting rock groups and entertainers. The demand has facilitated the addition of a second motorcoach.

The group tour industry in North America was estimated at $11.6 billion in 1996.

Robert Brennan, president-elect of the NTA, and owner of Brennan Tours in Seattle, WA, says a number of factors have contributed to the growth of the group tour industry.

“The equipment our industry is using is far superior to what was once used,” says Brennan. “Buses typically cost between $350,000 and $400,000. They have video players, reclining seats, premium sound systems, and bathrooms. The public understands that the vehicles are much nicer and a motorcoach operator is not a bus operator.”

According to Brennan, there are 625 tour operators that are members of the NTA. “Our Consumer Protection Plan covers qualified deposits of up to $250,000 in the unlikely event of an NTA tour operators bankruptcy” he says. “The association also has close to 800 destination marketing organization members, including state and provincial tourism offices, convention and visitors bureaus, and chambers of commerce. The public wants to be educated and entertained. They enjoy the safety of traveling in a group.”

Brennan says the traditional image of the senior citizen market has changed in the tour industry. “We are seeing many more baby boomers as customers,” he says. “We have several clients in white-collar positions who enjoy traveling by motorcoach. Also, when President Clinton and Vice President Gore decided to campaign for reelection in a motorcoach, it brought positive attention to our industry. These factors, a strong economy, and a booming leisure industry have made our members very optimistic about the future.”


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