ASSOCIATED PRESS / APRIL 2004 A weakening yen and restricted availability of hotels and flights have softened tourism from Japan. Here, Japanese visitors travel down Kalakaua Avenue aboard the Waikiki Trolley.

Tourism from Japan falling short of targets

A weakening yen and the restricted availability of hotel rooms and flights have contributed to a softening of Japanese tourism in Hawaii, pulling arrivals and visitor expenditures from the market down, relative to state targets.

The Japan tourism market, which took a nose dive beginning with the war with Iraq in 2003, has continued to improve, but its performance is trending below earlier economic forecasts for the visitor industry, members of the Hawaii Tourism Authority said at their most recent monthly board meeting.

Japan's visitor numbers are up slightly, but the increase is relatively small, given the market's potential, said Sharon Weiner, an authority board member who also serves as a group vice president for the tourist-oriented retailer DFS Hawaii.

"Year to date, arrivals from Japan are about 5 percent down over target, and spending is about 6 percent down," Weiner said. "I want to highlight the fact that we are down."

A drop in available hotel rooms and flights for the eastbound market has meant that visitors from the U.S. mainland will increasingly fill Hawaii hotel rooms and coffers, said Frank Haas, marketing director for the HTA.

"Japan arrivals look to be down 2 to 3 percent for October; however, they are up for the year," Haas said. "This will be the second consecutive year of growth for the Japan market after seven years of decline."

While the overall Japan market has shown signs of improving, almost anything looks better than the spring of 2003, when Japanese outbound travel was hammered by the war with Iraq and the scare over severe acute respiratory syndrome, or SARS, Haas said.

Japanese visitor arrivals to Hawaii, which peaked at 2.2 million in the mid-1990s, fell to 1.3 million in 2003, Haas said.

The phenomenal success of the domestic segment of Hawaii's visitor industry, which now expects a record 7.4 million arrivals this year, means there is less room for other markets.

It is hard to evaluate what is going on with Japanese arrivals when the mainland business is on fire, said John Toner, HTA chairman and executive vice president of the Ko Olina Resort Association.

Arrivals this year have grown from all markets that send the most visitors to the state -- the U.S. mainland, Japan and Canada -- with the strongest growth coming from the islands' biggest source of visitors, the U.S. West region. Growth is expected to taper off next year, when the islands are projected to get about 7.6 million arrivals.

"I've heard that it's hard for Japanese to get rooms because there have been so many conventions," said Leon Yoshida, an HTA board member and president of Japanese in-bound tour operator Sawayaka Hawaii.

The number of visitors in Hawaii for a convention nearly doubled to 24,887 in September from the same month in 2004. The number of people here on a honeymoon rose 12.7 percent to 55,848, driven by a double-digit increase in Japanese honeymooners.

Continued recovery in the Japanese market also will depend on how soon the country's airlines can restore flights that have been cut, Weiner said.

"Japan Airlines is a big problem. They are cutting flights," she said. "They have to get back on their feet -- that's where the future lift is from."

Because of the high price of fuel, JAL and other airlines have had to cut back, said Gilbert Kimura, JAL sales director in Hawaii.

Honolulu's only daily flight from Fukuoka, Japan, was cut in October, as well as one of the daily flights that runs from Osaka to Oahu, Kimura said.

Despite the decrease in airline seats and rooms, the upcoming Honolulu Marathon, which draws heavily from the Japanese market, is looking strong.

With a large influx of Japanese entries -- about 1,511 more than last year -- the 2005 Honolulu Marathon is now nearly 5,000 total entries ahead of last year's 25,671. This year's marathon is expected to be the first to draw more than 30,000 participants since 2002.

"We target the Japan market heavily, and had the same concerns about airlift and hotel, but we were pleasantly surprised," said Jim Barahal, founder of the Honolulu Marathon. "We're up from this time a year ago."

But while the marathon is being well received in Japan this year, an increase in hotel rooms and air seats could further strengthen participation.

"We could easily accommodate another 2,000 or more runners if they are able to get hotel rooms or flights," Barahal said.