Memorial Day: AAA expects 483,000 car breakdowns this holiday weekend

AAA Northeast Senior Manager Robert Sinclair, Jr. sits down with Yahoo Finance Live to talk about U.S. travel trends ahead of the Memorial Day weekend, gas prices, the durability of Americans' cars, and international travel trends.

Video Transcript

DIANE KING HALL: Meantime, millions of Americans are expected to pack their bags this weekend for Memorial Day travel. And with average gas prices standing pretty steady at $3.57 a gallon, pain at the pump is subsiding at a perfect time ahead of the holiday weekend generally speaking, compared to a year ago. Robert Sinclair Junior, AAA northeast senior manager joins us now to talk about this. I saw you wave your hand.

JULIE HYMAN: You travelled to--

DIANE KING HALL: I mean, compared to a year ago, right?

ROBERT SINCLAIR JR: Yes, but we have not seen a corresponding rush to the pumps--

DIANE KING HALL: OK.

ROBERT SINCLAIR JR: --as a result of cheaper gasoline.

DIANE KING HALL: Right.

ROBERT SINCLAIR JR: You would think that people would be burning it like crazy. But as measured by implied consumption-- implied demand by the Energy Information Administration, we're actually not as high as 2019. We're at 9 million barrels per day. 378 million gallons per day is like the magic figure that indicates robust driving. We've only seen that maybe four or five weeks this year. In 2019, it was 20 to 30 consecutive weeks. So there isn't the rush to the pumps that lower gasoline prices would make you think would happen.

We did a survey back in March of 2018 during a good economy asking drivers what the pain point was for the price of gasoline. 40% said $3 a gallon back then, right? Then they would have to drive less. They'd cut back on discretionary purchases, things like appliances, that kind of thing. So $3 a gallon, that's-- that's pretty cheap.

JULIE HYMAN: But is the swing in this case that people are not driving to work every day? I mean, if I just think about the main difference between 2019 and now, travel demand is back. Wouldn't seem to be that. The one big difference is that not everyone's going to the office every day anymore.

ROBERT SINCLAIR JR: That could be it. I just worry that drivers don't have the elasticity in their budgets as a result of inflation--

DIANE KING HALL: Yeah, I wonder-- I mean--

ROBERT SINCLAIR JR: --paying for food and shelter. They don't have the money left over for nonessential driving. Nonessential driving.

DIANE KING HALL: And maybe that is even also part of-- I mean, some of it may be habit, but maybe that is part of the push-back on the return to office that some companies are experiencing. But you are-- AAA is predicting a rise in demand in travel for this weekend, right?

ROBERT SINCLAIR JR: Well, you know, Americans are hard working. We get the fewest number of vacation days of any workers in the industrial world. You know, Europe takes all of August off. So when we get a free day, we take advantage of it.

JULIE HYMAN: We're going to take it.

ROBERT SINCLAIR JR: So, you know, forget about everything. We're going to take advantage of this holiday and get out and travel. It's going to be the third highest all time overall and the second highest of all time according to our figures as far as air travel is concerned, exceeding 2019 by 170,000-- 3.4 million traveling.

And we have to-- I have to let you know how we measure. We only measure leisure travelers. And if you're making a trip, say, from New York to California and you're getting a connecting flight in Texas, some people measure-- some organizations measure that as four flights. You do the same thing coming back, we measure it as one.

DIANE KING HALL: What's our busiest day this weekend?

ROBERT SINCLAIR JR: Oh, yesterday.

DIANE KING HALL: Yesterday.

ROBERT SINCLAIR JR: Yeah.

DIANE KING HALL: I thought so. I noticed that.

JULIE HYMAN: That's good news for someone driving today.

ROBERT SINCLAIR JR: It won't be a picnic today.

JULIE HYMAN: Oh, come on, Robert, tell me some good news.

DIANE KING HALL: It all happens when we're leaving here.

ROBERT SINCLAIR JR: Yeah.

JULIE HYMAN: I got to ask you about breakdowns because you had some really interesting data as well about the age of US vehicles, whether or not people are taking good enough care of them. What is-- what are the implications for breakdowns?

ROBERT SINCLAIR JR: 483,000 breakdowns, and that's just of AAA members, for this holiday weekend. 5% more than last year. S&P released data a couple of weeks ago that said the average age of a vehicle on the road in the United States is 12.5 years. We know that when you hit 10 years, you're going to start having a lot of problems. Your transmission, your cooling system, those kind of things. So I think-- and we did another survey also in 2017. 40% of drivers said they didn't have $1,000 for an emergency vehicle repair.

DIANE KING HALL: Yeah, yeah.

JULIE HYMAN: And are they doing the maintenance?

DIANE KING HALL: Yeah, we've seen some of that.

JULIE HYMAN: Are they spending on the needed maintenance so that their cars won't be as likely to break down?

ROBERT SINCLAIR JR: No, they are not. And unfortunately, we're going to see flat tires and dead batteries as the top items we get calls for. And it's not only inconvenient, it's dangerous.

DIANE KING HALL: Right.

ROBERT SINCLAIR JR: We see that a lot of people get killed when they're with a disabled vehicle by the side of the road.

DIANE KING HALL: Yeah.

ROBERT SINCLAIR JR: Many of our roads lack a shoulder. They predate modern transportation engineering. And-- but we are seeing, interestingly, a lower number in terms of the number of calls that we're getting for people who are broken down. So there's going to be a lot this weekend.

DIANE KING HALL: Despite the aging vehicle.

ROBERT SINCLAIR JR: Yeah.

DIANE KING HALL: Yes, we saw-- we talked about this. We saw one on our way in. We drove in separately but we saw one.

JULIE HYMAN: We should have car-pooled.

ROBERT SINCLAIR JR: And you drive in?

DIANE KING HALL: That's true. Yes.

ROBERT SINCLAIR JR: That's very interesting.

JULIE HYMAN: Very early.

DIANE KING HALL: Not every day.

JULIE HYMAN: Very early.

DIANE KING HALL: This is just because of coming in very early.

ROBERT SINCLAIR JR: Yes, yes. That makes sense.

DIANE KING HALL: And then normally traffic is better. But there were certainly some that we faced today. I want to ask you about airline travel. So you all are projecting an increase this-- this, you know, kind of kick off of summer. What are you seeing? What trends are you seeing there?

ROBERT SINCLAIR JR: International travel, very high. As the gentleman from Priceline said, we're seeing 250% increase in international travel bookings. They're going to London, Paris, Rome. They really like river cruises in France and Germany.

JULIE HYMAN: My dad just went on one of those.

ROBERT SINCLAIR JR: There you go. So Europe, very popular. I think people have a lot of pent-up demand because of last year and all the problems that they had. Remember last year, all the cancellations and delays?

DIANE KING HALL: Right.

ROBERT SINCLAIR JR: It was real bad. Well, now things are in place. The only fly-in-the-ointment might be air traffic control because a lot of air traffic controllers were laid off during the pandemic. There were far fewer flights. Now they need them and training is like two years long.

JULIE HYMAN: Wow.

ROBERT SINCLAIR JR: And the worry is that, particularly in New York, we won't have enough air traffic controllers. And I believe the FAA was asking airlines--

JULIE HYMAN: Yes.

ROBERT SINCLAIR JR: --to cut back on the number of flights.

DIANE KING HALL: Yeah, we talked about that. Yeah, yeah.

ROBERT SINCLAIR JR: So you have to be careful of that. We've got a lot of good advice for travelers. If they're flying, make sure you have the app of your airline on your phone. Make sure the phone is fully charged. If you have a problem--

DIANE KING HALL: Absolutely.

ROBERT SINCLAIR JR: Do not check bags. Use carry-ons in case your flight is canceled or delayed. You'll have your luggage with you. And use the phone number for the international or rewards numbers for your airline. The regular customer service number might get a little busy. So have that other number to call in case you have to make a change. But the weather is good. That's a big X factor. 75%--

DIANE KING HALL: Yes, compared to like the holiday season.

ROBERT SINCLAIR JR: Yes, 75% of all weather-related air traffic control delays stem from New York. We've got six major airports here. The hub and spoke system means that something bad happens here, New York sneezes, the whole country catches a cold.

DIANE KING HALL: Wow, good stuff.

JULIE HYMAN: I'm going to keep that-- that was really a great tip about--

DIANE KING HALL: Yes, I love the tips.

JULIE HYMAN: --calling the international or the rewards.

ROBERT SINCLAIR JR: Call the international all the rewards line, yeah.

JULIE HYMAN: That is a great tip.

ROBERT SINCLAIR JR: As long as you get through to somebody.

DIANE KING HALL: Right.

JULIE HYMAN: Oh, I know the feeling.

DIANE KING HALL: Robert, what a pleasure to see you in person.

ROBERT SINCLAIR JR: Good to see you. Oh, it's good to be here. I'm so tired of being at home with Zoom. It's good to see you.

DIANE KING HALL: We love this.

JULIE HYMAN: Good luck getting wherever you need to be next. Robert Sinclair Junior.

DIANE KING HALL: Thank you, Robert.

JULIE HYMAN: AAA northeast senior manager.

ROBERT SINCLAIR JR: Thank you.