Room shortages might
slow Japanese tourism

Hawaii's travel professionals
expect fewer bookings during
the obon season

Hawaii's hot tourism market, which has made it difficult to book rooms this summer, could cause Japanese travel to be slower than expected during obon -- traditionally one of the strongest arrival times.

The number of Japanese tourists coming to Hawaii will rise this month for the obon holiday, but the peak travel time, which used to look like Mount Fuji, will probably resemble Mauna Kea's softer rise due to tight occupancy in Waikiki and the neighbor islands, said Ryokichi Tamaki, senior vice president of Jalpak International (Hawaii).

"The peaks are going to be lower," Tamaki said.

Obon, which runs mainly from Aug. 8 to 16, is normally one of Japan's prime travel seasons, when workers take vacation en masse. In anticipation of the Japanese travel demand, the state launched a major Japanese tourism campaign and the airlines added 1,000 extra seats serving Hawaii. However, as tourism from the U.S. mainland increases, the supply of budget and middle-class hotel rooms in Hawaii has tightened. The Japanese may increasingly find that they can secure a plane seat, but not a hotel room.

"We're pretty guilty as charged," said Karen Hughes, regional director of sales and marketing for Hawaii and French Polynesia for Starwood Hotels and Resorts Worldwide Inc.

"We just can't fit the whole world in one week," Hughes said, adding that August is traditionally one of Starwood's top months as mainland travelers hurry to complete vacations before the start of school and Japanese travelers take advantage of obon's longer travel windows.

Hawaii will reign as the most popular destination for Japanese this summer, but the demand hasn't translated into an immediate boom in reservations, said Taka Kono, author of the Japan Report, which is used by Hawaii's visitor industry to gauge Japanese tourism.

"Obon bookings are not slow because demand is weak," Kono said, adding that since Golden Week, a traditional spring traveling period in late April and early May, the Japanese mindset on traveling has improved dramatically.

"Demand for overseas travel can only increase with a stronger Japanese economy and yen," he said.

The challenge for travelers will be to arrange both air and hotel reservations, Kono said.

Japanese travelers still recall the era when Hawaii had an oversupply of hotel inventory and they expect rooms to be available even in the busiest times. While mainland travelers often book vacations six months out, many Japanese travelers plan vacations only a month or two in advance, he said.

"In other words, as the late booking trend continues, the Hawaii market will be losing Japanese tourists," he said.

High tour package prices and short booking windows have made it more difficult for Japanese travelers to get to Hawaii during obon, Tamaki said, but added that pent-up demand may cause many to book outside traditional travel periods.

"If they came in the fall when business isn't as strong, that would be very good for Hawaii," he said.

However, if it's too difficult to visit Hawaii, the state might lose some Japanese tourists to emerging destinations like China, Korea and Thailand, said Yujiro Kuwabara, manager of tourism planning and development for JTB Hawaii.

That trend is already happening, said Gilbert Kimura, spokesman for Japan Airlines.

Because Hawaii's visitor industry experienced a big rebound in Golden Week travelers, an equally strong showing was expected during obon, but advance bookings don't support that hypothesis, Kimura said.

"August is supposed to be summer vacation and a peak month for the Japanese," Kimura said. "However, it's not as strong as we anticipated because there is a lack of hotel space."

David Carey, chief executive officer and president of Outrigger Enterprises Inc., said he's not surprised that many Japanese travelers are experiencing difficulty booking rooms.

"Summer has been robust," Carey said. "We don't have the inventory to meet the demand from multiple directions -- not just Japan."

Business has been booming at Outrigger Hotels & Resorts with some properties seeing occupancies rise to levels not seen since the late 1980s, he said.