Record gas prices making travel and tourism 'very unaffordable' in Ontario, experts warn

As gas prices reach record highs, those who work in tourism and hospitality say it will force people to make difficult decisions on where they travel this summer.

The average price of gas in the GTA, and in most of southern Ontario, is expected to reach a new record this weekend. According to the Canadians for Affordable Energy, a group that monitors the cost of fuel for consumers, gas prices were to hit 212.9 cents per litre on Friday. On Saturday, they're expected to reach 215.9 cents per litre, the group says.

"It's going to limit how many trips people are taking and how far they're willing to go," said Wayne Smith, a professor of hospitality and tourism management with the Ted Rogers School of Management at Toronto Metropolitan University.

Smith says the combination of the COVID-19 pandemic and rising gas prices will hamper the recovery of the tourism industry, especially in rural areas that rely on city-dwellers vacationing and visiting their businesses.

Inflation is already increasing the prices of other goods and services, making the issue worse.

"A lot of trips are becoming very unaffordable," he said.

Smith adds it will force people to take fewer trips and to closer destinations.

He recalls the last time people were talking about gas prices like this was the energy crisis during the 1970s. Back then, high gas prices changed consumer behaviour and he expects a similar situation this time around.

"If we look historically when there are bad economic times, usually the first thing cut out is travel budgets," Smith said.

He says it will make recovery slower and more painful for an industry that's already struggling.

In response to the volatility, some business owners are taking some unique approaches.

Jessica Off, the owner of Guess Where Trips Inc., offers surprise road trips that are self-guided from an array of different themes.

She started the business in January 2020 and says COVID-19 was more devastating to the industry than gas prices at that time. But now, she says, it's the cost of fuel that's dictating travellers' decisions.

They're carpooling to split money on gas, they're choosing closer destinations, and they're choosing to stay overnight to try and take advantage of the Ontario Staycation Tax Credit — under which Ontario residents can claim up to 20 per cent of eligible accommodation expenses this year.

"We've heard a lot of comments from travellers about gas prices, so a lot of people are pushing their potential getaway aside and doing more local trips," Off said.

Smith says those decisions might increase local traffic in Toronto, where people might opt to spend the weekend closer to home instead of driving to more far-flung destinations across the province.

"We might see a large increase in local traffic as people replace their weekend getaway with a more local staycation."