A bright exception


POSTED: Wednesday, April 29, 2009

Tourism officials are worried that publicity about swine flu and a proposed hotel-room tax increase could scare away Japanese travelers, snuffing out the only bright spot for the state's visitor industry last month.

March arrivals from Hawaii's struggling Japan visitor market rose slightly to 102,699 as visitors took advantage of discount vacation packages, declining fuel surcharges and a favorable exchange rate.




Visitor arrivals

        The number of visitors arriving in Hawaii by air in March with the percentage change from the same month last year:

Grand total* 555,902-16.6%



By Island


Big Island107,000-17.7%



* Includes air and ship arrivals


Source: State Department of Business, Economic Development and Tourism




“;It's encouraging that for the first time in almost a year, Japanese arrivals showed growth partially because of the strength of the yen and the success of this year's Honolulu Festival,”; said State Tourism Liaison Marsha Wienert.

She added that the number of Japanese honeymooners increased 22 percent last month, and wedding couples increased by 11 percent. All other markets to Hawaii fell last month, resulting in a 16.6 percent drop in arrivals and a 24.4 percent drop in visitor spending, according to statistics released yesterday by the state Department of Business, Economic Development and Tourism.

It was the 13th continuous drop in monthly arrivals for the state and the longest-running slump for Hawaii tourism since posting 18 out of 19 months of declines following the U.S. recession of 2000 and Sept. 11, 2001.

Though the increase in arrivals from Japan represented a scant 0.6 percent increase from March 2008, it created hope that Hawaii's highest-spending tourists might be on their way back.

The Japanese visitor market sank to a nearly two-decade low last year. Japanese arrivals fell below 1.2 million in 2008, a more than 45 percent drop from the peak 2.2 million visitors Hawaii saw in 1997.

“;Hawaii has always been a momentum destination,”; said Keith Vieira, senior vice president of operations for Starwood Hotels & Resorts-Hawaii & French Polynesia. “;If you can turn the tide, it can begin to grow.”;

However, the burgeoning Japan market has always been delicate, said Akio Hoshino, senior vice president for Jalpak International Hawaii.

While arrivals have picked up as fuel surcharges have dropped, it wouldn't take much to reverse the trend, Hoshino said.

“;When we had SARS in 2003, we had a big, big decrease in foreign travel abroad,”; he said. “;The Japanese people are very, very conscious about bird flu or swine flu.”;

Though Hawaii has had no reported cases of swine flu, and there have been no confirmed swine-flu deaths on the U.S. mainland, Jalpak has already received a few cancellations, Hoshino said.

“;They are more cautious than most markets,”; Vieira said.

Once known as “;Hawaii's big spenders,”; Japanese travelers have recently become more price sensitive, he said.

Hawaii has enjoyed a resurgence in Japanese visitors since the fuel surcharges dropped from a peak $440 a person to $40 a person, and the market is expected to pick up even more in July after the fuel surcharge disappears completely, Hoshino said.

However, anticipated gains might not materialize if the Hawaii Legislature imposes a 2-percentage-point hike in the transient accommodations tax, which shows up on each visitor's room charges, he said.

Hoshino estimates that the increase, which would be spread across two years, would add $15 a person to the cost of tours.

“;Travelers all over the world are facing tough economic conditions, so even a dollar increase is too much,”; he said.

Taxes and surcharges kill the value message that Hawaii has worked so hard to build, Vieira said.

“;We've all lowered our rates, and now the state is trying to raise theirs,”; he said. “;It's absolutely crazy.”;




Slowdown continuing

        The monthly total arrivals and the percentage change in visitors to Hawaii.



MonthArrivals% change





MonthArrivals% change