Americans Still Flock to Europe as Dollar Drops

[JODO 2]

July 18, 2007

Americans Still Flock to Europe as Dollar Drops

By MARK LANDLER

HEIDELBERG, Germany — A day after Michael Kingsley arrived in this romantic university town, he was in no mood to savor the cobblestone streets, the half-timbered houses, or the flower-bedecked windows — to say nothing of the camera-ready castle on the hill.

Mr. Kingsley had left his camera battery and charger in a hotel room in London, and he knew that as an American tourist, buying replacements here was going to sting. The damage: $143. Back home in Falls Church, Va., he said, the same purchase would have set him back no more than $100.

For Americans visiting Europe this summer, the steep decline of the dollar against the euro and the British pound has made eye-popping prices a lamentable part of the traveler's tale. (The Kingsley family's hotel room in London was $500 a night; five bite-sized chocolates at Harrods cost $10.)

"It's O.K.," said Mr. Kingsley, 59, with a resigned laugh. "I'll just have to work a few extra years to pay off this vacation." His wife, Laura, did her best to soothe him. "It's just play money," she said.

By now, five summers after the dollar began its long swoon against the euro and the pound, American travelers are used to $5 cups of coffee and triple-digit dinner checks in Europe's great capitals. But the dollar's latest plunge — to record lows of $1.38 to the euro and $2.05 to the pound — has turned mere sticker shock into a form of disbelief for many tourists.

For Kaelon Kroft, a custodian from San Bernardino, Calif., it was the cost of Coke that shocked him most in Paris. "We just paid 9.50 euros for a can of Coke at a cafe," he said. "At our hotel, the bar was serving a glass of Coke for four euros."

"That's over five bucks," his wife Kristi added. Actually, at the current exchange rate, it is a fizzy bubble or two over $5.50.

The Krofts and the Kingsleys both scaled back their European holidays to limit the pain of the currency pinch. But neither family seriously thought of canceling their vacation, and their glass-is-half-full determination to make the best of things was echoed in interviews with American tourists from Ireland to Italy.

It is also reflected in the tourism statistics in France, Germany, Spain and other countries, which show that the number of Americans visiting Europe has increased this year, even as the value of the dollar has eroded. Travel experts say this speaks both to the resilience and rising affluence of American tourists, as well as to the perennial appeal of Europe as a destination.

"Americans who visit Europe tend to be more educated, with higher incomes, so they are less affected by the exchange rate," said Joachim Scholz, a researcher at the German National Tourist Board. "Even backpackers have more money than they used to, if you look at the price of hostels."

Americans purchased $3.8 billion worth of travel-related services from European countries in the first quarter of this year, a 5.5 percent increase from the same quarter last year, according to the Bureau of Economic Analysis. They bought $22.8 billion of travel services in 2006, nearly 10 percent more than in 2002, when the dollar was close to parity with the euro.

http://www.nytimes.com/2007/07/18/business...&ei=5087%0A

Edited July 19, 2007 by JODO

[Trumplestiltskin 5,791]

We're far from poor - but even so the exchange rate most definitely influenced vacation plans for this year - taking a trip to see friends Germany for the Oktoberfest rather than visit the family back in UK. With USD:GBP at 2 to 1, it would take months to pay off. Euro is worth more than the dollar these days - but far more favourable than the UK.

[MHandMB 0]

I really wish the rate would steady a bit. It's getting ridiculous! Soon, our dollars will be worth nothing.