World woos waryTOKYO >> This time of year, Vangelis Papas is usually busy guiding Japanese tourists around the cathedrals and opera houses of Prague and Vienna. This week, he's in Tokyo in search of a market that went away.
More than Hawaii suffers
when tourists refuse to travel
By Tim Kelly
"We've lost 80 percent of our customers," said Papas, general manager of Hungary-based Euroguide coach tours. While Japanese are canceling in droves, those from China are snapping up bargain offers. "If they get lower rates they don't mind, they travel," he said.
To Hawaii, the single favorite destination for outbound Japanese tourists, there are a "lot of cheap products but still it cannot recover", said Koji Shinmachi, president of Jalpak Co., a travel agent unit of Japan Airlines, Asia's No. 1 carrier.
Last year, a record 17.8 million Japanese ventured abroad, helping to fill handbag boutiques, sightseeing tours and hotels from Paris to Sydney and New York. The second-biggest economy provided two-thirds of the foreign tourists from the Asia Pacific to the U.S., spending an average $164 a day, or 80 percent more than the typical German visitor.
That spending gusher is spluttering. Since the Sept. 11 terrorist attacks, Japanese tourists have canceled about half their planned holidays in the U.S., Singapore and other markets. That's leaving Japan Airlines Co. and other carriers struggling to stem losses, and setting back the whole industry's recovery.
"Without their return, (tourism) faces a slow recovery," said Seiko Taniguchi, Hong Kong-based director of the Japan National Tourist Organization. Japanese tourists account for a 10th of visitors to Hong Kong.
Elsewhere in Asia, airlines and travel agents are reporting the first signs of a revival. Korean Air Co., that country's biggest carrier, said Wednesday it's seeing demand pick up, including to U.S. destinations such as Los Angeles.
Hong Kong-based Fellington American Express Travel Services said sales in November are up between 10 percent and 15 percent from October, yet still more than 30 percent less than usual.
"It's just a little rebound," said Lily Agonoy, the agency's assistant general manager.
Tokyo's main international airport at Narita yesterday said it handled 36 percent fewer departing passengers in the Nov. 1-20 period than a year earlier. The drop was more than the 32 percent drop for October, including 41 percent for Japanese passengers.
Efforts to entice Japanese back on board jets, including free hotel stays and steep discounts, aren't making much impact.
Japan Airlines has cut 9 percent of its seat capacity on overseas routes until the end of March, including 28 percent on transpacific routes. The Tokyo-based airline will fly 51 times a week to Hawaii in December, 27 fewer than originally planned.
JTB Corp., the country's largest travel company, is now offering a five-day three night tour to the island chain for 49,800 yen ($404), compared with the cheapest price of 66,000 yen prior to the attacks, company spokesman Hiroshi Ueno said.
Cancellation of trips may reach as much as 50 percent to the end of March, said Isao Matsuhashi, president of JTB.
Still "we hope for a recovery from the new year," he said, speaking at an international conference in Tokyo Wednesday hosted by the Japan Association of Travel Agents. Euroguide's Papas also attended the travel conference to drum up business.
The reluctance of Japanese to travel is hurting the economies of Australia and other Asia Pacific countries that rely on tourism.
Australia reported a 25 percent fall in visitors from Japan for the month, its lowest tally in 2 1/2 years, according to the Australian government. Visitors from the U.K. fell 5 percent.
Visitors from Japan "are terribly important to Australia, because are effectively our largest market outside of New Zealand," said Peter Shelley, managing director of the Australian Tourism Export Council. "Our discussions with the Japanese wholesalers indicate it is still a very soft market going forward into the first quarter of next year," Shelley said.
Those that do come are bringing less cash, said Jessica Li, who sells opals at Tiara Jewelry, in the shadows of the Sydney Opera House.
Average purchases of opals and other trinkets is now less than $100, down from $500, she said.
"Before, young people only bought cheap things and older people bought more expensive things," Li said. "But now, both of them are buying cheaper things."