Seat 2B By Joe Brancatelli
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Brexit Bonanza: Why You Should Travel Now
June 30, 2016 -- Maybe the issue isn't how the Brexit will change international travel, but how travel has already influenced the United Kingdom's relationship with the European Union.
I mention this because the Financial Times believes now-outgoing British prime minister David Cameron cooked up last Thursday's stay-or-go referendum in 2012 at a pizza joint in Chicago's O'Hare Airport. And despite skepticism and claims to the contrary, the Chicago Tribune concludes reliable witnesses contemporaneously spied Cameron chowing down at ORD before an American Airlines flight to London.
In other words, there are a million questions and precious few answers about Brexit, but we are once again reminded that very little good happens at O'Hare Airport. Now we can add globe-shaking, market-rattling political instability to O'Hare's perennially late flights, its interminable walks between terminals and its infuriating security queues.
But Brexit's impact on travel? No one knows. There are lots of guessers, of course. Plus plenty of instant experts on a matter that has never happened before. And, as you'd expect, familiar bobble-headed TV talkers adapting existing talking points for this post-vote world.
I refuse to tell you stuff I don't know. But here are five things I believe about Brexit and how travel might change because a British PM committed political malpractice while wolfing mediocre pizza between flights.
1. Visit Great Britain right now
The British pound has been sliding against the U.S. dollar since 2008, when its value was north of $2. So Britain was already a comparative bargain last Thursday when the pound stood at $1.49 as Brexit polls closed. The moment it became clear that leave forces were doing better than expected — that was about 7:30 p.m. U.S. Eastern time when a region called Sunderland voted overwhelmingly to exit — the pound began to slide. By the end of the slaughter on Monday, the pound had fallen to $1.32, the lowest point in 31 years. As of Wednesday evening, it had recovered to about $1.35.
But those numbers — representing an instant 10+ percent discount for U.S. travelers when they pay for things in pounds — are dry statistics. Let me offer a real-world example.
When I arrive at London's Heathrow Airport, usually around daybreak, I hop on the Heathrow Express train to Paddington Station. (That costs 22 pounds with a modest advance purchase.) I then take the escalator into the lobby of the Hilton Paddington hotel. (It has rooms tonight, June 30, for 175 pounds). I check in, shower, shave, read my email, make a few calls and then take a nap. About 1 p.m., I walk across the street to a little curry house I favor and spend 20 pounds for lunch. That's a total of 217 pounds. In 2008, at $2 to the pound, that cost U.S. $434. Last Thursday, while the Brits voted on Brexit, it would have been about $323. At the current exchange rate, it costs about $293 — a savings of $30 from last week and more than $140 compared to 2008.
In other words, go to the United Kingdom right now, while the going is cheap. Whether you're squeezing in an extra holiday or an additional business trip, it's a fabulous time to work or play in Britain on the cheap.
2. Go to Europe this summer and fall
Continental Europe in the summer rarely appeals to me: too many goggle-eyed tourists and too many Europeans away on their own holidays, which saps the social life of my favorite places. Throw in August's torrid weather and you have a recipe for a mediocre vacation.
But you know what? Europe is empty and cheap now. It's empty because terrorists attacks in Paris, Brussels and, on Tuesday, at Ataturk Airport in Istanbul, have frightened away skittish tourists. And it's cheap because the euro has slumped to $1.11 and that makes everything — lodging, dining, ground transportation, museum entrances — notably less expensive than in recent summers. Plus carriers plying transatlantic routes are frantically discounting to fill seats. Coach class flights are suddenly as low as $650 roundtrip on some routes and business class seats can be secured for as little as $1,600 roundtrip. However, prices are bouncing around erratically, so shop wisely. Try Google subsidiary ITA Software and choose the "see calendar of lowest fares" radio button. That'll display a day-by-day look at a month's worth of fares.
3. Some American cities will be cheaper
That 10 percent plunge in the value of the British pound will impact summer holidays here at home, too. Why? Some Brits expecting to visit their favorite American destinations — New York, Los Angeles, Las Vegas, anywhere with a beach — will find a holiday too pricey. (To a lesser extent, so, too, will Eurozone holidaymakers.) That'll depress short-term travel to the U.S. from Europe and hold down hotel prices.
4. London will be less important
It's nearly impossible to overemphasize the importance of London in the American financial and emotional firmament. Eight of the 10 busiest routes between the United States and Europe have London at one end. And the so-called NyLon route (New York-London) remains the most prestigious and profitable in the world. But if there really is to be a Brexit, London eventually will matter less because financial institutions will move some employees and lines of business to continental banking centers such as Frankfurt, Paris and Zurich.
5. Brexit may never happen
On the other hand, Brexit may never happen. For starters, last week's referendum was literally an opinion poll. There is no British law or EU rule that requires either side to honor the results. And with the British ruling class in chaos — besides Conservative prime minister David Cameron's resignation, Labour Party leader Jeremy Corbyn lost a no-confidence vote — anything could happen. Scotland, which voted overwhelmingly to stay in the EU, is openly discussing ways it can remain. Even the leading establishment "leave" politician, former London mayor Boris Johnson who just today took his name out of running to be the nation's next prime minister, is hedging and slow walking any potential Brexit timeline.
My best advice: Wait until September 9. That's the day a Tory leader is announced. With Cameron's departure, the Conservative chief immediately becomes the prime minister. We'll then have a better sense of what could happen next: a new general election, a time frame for starting the two-year Brexit withdrawal clock called Article 50 or perhaps a let's-rethink-this-whole-thing compromise.
Meanwhile, do yourself and the world a favor: Don't take a meeting with anyone suggesting you grab a pizza before a flight at O'Hare. Life on the road is tough enough already.