"We are, however, encouraged by the level of summer bookings and look forward to good traffic through the peak period," he added.

Holidays are now becoming essential purchases and in 1992 summer bookings were 12 per cent up on last year.

Already the lowest they've been in decades, many leisure fares dropped even further this spring as cash-desperate airlines tried to pump vitality into summer vacation-travel bookings.

The summer schedule is issued in November, and summer bookings open on the first business day in December; the ships are often booked up by April.

The frenzy generated by the air fares spilled over to buses, trains and motor-coach tours, each of which has reported increased summer bookings.

It said it was prepared to enter bankruptcy soon, while its cash cushion was thick from summer bookings.

Kaufman is booked solid through the end of spring, and summer bookings are already starting to come in, according to Hal Rosenbluth, its chief financial officer.

Thomas Cook Travel, another big chain, also reports strong spring and summer bookings for foreign vacations, especially in Europe.

Gary Kelly, chief financial officer of Southwest Airlines, the world's most profitable carrier, gave a lukewarm appraisal of summer bookings.

Analysts say summer bookings indicate that the season is shaping up as one of industry's best.