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Travelers defy weak euro

Jessica WalkerMarch 5, 2015

A strong US dollar is a nuisance for most Europeans traveling abroad, but that hasn't stopped them from booking pricier flights and hotels. Germans in particular remain unperturbed by a drop in purchasing power abroad.

Taxis in New York City
Image: Fotolia/Delphotostock

Germans traveling to the United States are left empty-handed after exchanging their euros for dollars, but that hasn't dampened their sense of wanderlust.

In May last year, the euro was trading at an average rate of $1.40. Since then, the currency has plunged to levels not seen in over a decade. On Thursday, the euro dropped to $1.1080 - its lowest level since September 2003.

A weeklong trip to New York City that cost $2,500 last spring, or about 1,800 euros, now goes for more than 2,200 euros.

And with currency experts predicting euro-to-dollar parity by the end of 2016, transatlantic travel is only going to get more expensive for travelers from the eurozone.

Less bang for their buck

The weak euro has hit some European tourists harder than others.

"In the crisis year of 2009, shopping in the US really paid off, especially for expensive stuff," said Rebecca Seitz, a 23-year-old student from Germany. "But now, where one dollar almost equals one euro, I'm not going to buy things here that I can get in Europe for the same price."

The number of European tourists visiting the Big Apple, however, is not on the decline, according to NYC & Company, the city's official marketing and tourism organization.

A German passport in someone's pocket
Approximately 2 million Germans traveled to the US in 2013.Image: Fotolia/babimu

“Development of new hotels, restaurants and attractions means New York City is increasingly affordable to visitors," said Fred Dixon, the firm's president and CEO.

In good times and bad

Some industry analysts expect the number of European tourists, particularly those from the common currency bloc's strongest economies, will continue to rise within the next couple of years.

After some 7.7 million overseas visitors came to New York City in 2009 - the most popular destination for foreigners visiting the US - that number rose to around 9.9 million in 2013. According to data from the US Travel Association, approximately 2 million Germans traveled to the US in 2013. The number of British visitors that year was nearly twice that.

"A favorable currency situation is obviously helpful to attract German and other European tourists. But even when it's less favorable, they continue to come - during the best and the worst economic times," said Chris Thompson, president and CEO of Brand USA, the Americans' official tourism marketer.

But European travelers may reevaluate the scope of their trips or shop more conservatively than they did when their purchasing power was higher, he said.

No signs Germans will stay at home

Thompson said he was confident Germans' desire to travel would not abate. He anticipated a rise in visitors from Europe's largest economy of 2 percent this year - and with each percentage increase, a billion dollars is added to the US economy.

His optimism found reinforcement in a bright forecast for national and international travel in the US, prepared by the German research organization Forschungsgemeinschaft Urlaub und Reisen (FUR).

The study's preliminary results indicated that Germans' enthusiasm for travel will continue to propel their country's domestic tourism industry and drive growth in long-haul destinations.

FUR presented its full analysis at the International Tourism Market in Berlin on March 4.

Europe on sale

For all the hopefulness for America's travel industry, a strong dollar remains a nuisance for most European travelers. From the steep price of a hotel to expensive shopping sprees - travel experts estimate that the euro-to-dollar exchange rate will bloat holiday costs for foreigners by 10 to 15 percent.

But one man's pain is another man's pleasure, especially for Americans contemplating a trip overseas.

Brian Hardeman-Smith of New Jersey felt bad for European tourists looking to do some spending in the US, even if he is quite happy about the low euro exchange rate.

“For me it's a perfect time to go to Europe," he said. "I will definitely buy plane tickets and organize a small Europe trip, maybe to Germany or France.”