Destinations

Drop in Cruise Arrivals Drives Hawaii’s Tourism Troubles

May 30, 2014 3:00 pm

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Hawaii’s tourism slowdown comes after a significant period of growth so although visitors numbers aren’t rising at the expected pace, travel remains the number one industry in the state.

— Samantha Shankman

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Landscape on tropical beach, Oahu, Hawaii. Getty Images


Hawaii’s record tourism numbers of the past two years are turning into a distant memory.

For eight months in a row, visitor spending has slipped below the year-ago level. In April, spending was down 2.2 percent, meaning tourists brought in about $24 million less last month compared with April 2013.

And visitor arrivals were down 0.7 percent from the year-earlier period, according to preliminary data released Thursday by the Hawaii Tourism Authority.

To be sure, the state’s No. 1 industry is still doing well, just not as well as it did the past two years when records were set in both number of arrivals and spending.

The number of visitors to Hawaii fell to 662,553 from 666,959 in April 2013 while spending declined to $1.08 billion from $1.10 billion.

The weakness is likely to continue, according to HTA President and Chief Executive Officer Mike McCartney.

“The HTA anticipates a continued slowdown through the second quarter of 2014, a traditionally slower travel period for the state,” he said.

McCartney attributes the slowdown to a decline in Hawaii’s cruise ship industry, growing competition from other vacation destinations, the strengthening of the U.S. dollar against international currencies and other economic conditions.

The state’s cruise business saw an 18.9 percent decline in air and ship arrivals. McCartney said HTA is seeking to bolster cruise operations by working with the state Department of Transportation and Department of Land and Natural Resources to improve access at Hawaii’s harbors.

Although it won’t help the economy this year, the Disney Cruise Line — which made its debut in Hawaii in 2012 — said earlier this month it will return next year for another limited engagement with the addition of two 10-day Hawaii cruises, between Honolulu and Vancouver, British Columbia, aboard the Disney Wonder.

McCartney said HTA is also focusing on diversifying its international markets by increasing destination awareness and interest in markets like Australia, New Zealand, China, South Korea, Taiwan and Latin America.

It was that lack of destination awareness in Taiwan that prompted Hawaiian Airlines to pull the plug on that route in July after just nine months in existence.

HTA recently contracted a general sales agent for Latin America and is planning to issue requests for proposals for representation in Hong Kong and Southeast Asia.

“Developing these newer markets creates opportunities for attracting first-time, higher-spending visitors to Hawaii,” McCartney said.

He said strengthening the state’s core markets like the U.S. and Japan also remain a priority for HTA.

Last month, visitors from the U.S. West, the state’s No. 1 market, fell 1.4 percent, and tourists from Japan, the top international market, declined 1.6 percent. Those drop-offs were partly offset by a 16.3 percent increase in Canadian visitors and a 0.7 percent bump from U.S. East tourists. The category of “all other,” which includes Australia, New Zealand and South Korea, slipped 0.2 percent.

Despite the lower expenditure numbers, U.S. West visitors spent 2.9 percent more in April than the same period a year ago, but U.S. East visitors spent 6.9 percent less. Canada spending jumped 10.2 percent and Japan edged up 0.2 percent, but the “all other” category declined 10.7 percent.

McCartney said he expects visitor arrivals and spending to continue to plateau this year compared with the past two years. In 2013, visitor arrivals reached a record 8.24 million while spending hit an all-time high of $14.54 billion. The year before that, arrivals set a record at 8.03 million, and spending was a record $14.25 billion.

McCartney said the HTA is also working with Hawaii Tourism Japan on promoting an Oahu concert with the popular J-pop group Arashi, which is expected to attract 15,000 visitors from Japan in September.

“Through the strategic and collective efforts of our industry, marketing and other stakeholder partners, we will continue to work together to balance and strengthen Hawaii’s tourism economy,” he said.

(c)2014 The Honolulu Star-Advertiser. Distributed by MCT Information Services.

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