Hawaii Island’s tourism industry has steadily increased over the years, but an increase in hotel prices and air fares could have an adverse effect on the market this year.
Hawaii Island’s tourism industry has steadily increased over the years, but an increase in hotel prices and air fares could have an adverse effect on the market this year.
That was the message David Uchiyama, brand manager and vice president of the Hawaii Tourism Authority, gave at a luncheon with the Japanese Chamber of Commerce Thursday.
“Things have been pretty good,” he said. “We still have concerns about going forward.”
Uchiyama, along with Ross Birch of the Big Island Visitors Bureau, spoke at the chamber’s “Tourism…It’s Everyone’s Business” event held in Hilo. Uchiyama led the discussion about the industry’s 2014 outlook.
Referencing a Powerpoint, he discussed details about air seat capacity, the island’s domestic and international markets, the cruise ship industry and what the future may hold for Hawaii Island tourism. One issue, he said, is that prices for hotel rooms continue to increase.
“What we’re now starting to see is that our product price is getting higher and higher and there’s a threshold for the consumer,” he said. “We’re coming up on that threshold and the consumer demand is falling off and when the demand starts to fall off your air seats start to fall off, and when your air seats fall off it cuts us all off.”
“Air seats are important for not just tourism, but the prices are important for all companies. All businesses benefit from air seat fare,” he said. “We’ve got to be very conscious of our product-price position so that we can sustain ourselves through some of these times that we’re coming up on.”
Another issue he touched on involved the cruise ship industry. Uchiyama suggested that there be a creation of a master schedule for all ports in Hawaii, for both Department of Transportation harbors and the state Department of Land and Natural Resources harbors; that there be a collaborative structuring of fees and the payment process; and a collaboration on long-term port agreements.
As for market projections, the United States West market has experienced an increase in seasonal airlift out of gateway cities like Los Angeles and Seattle.
Uchiyama expects that route and seat adjustments based on demand will result in reduced seat inventory, and there appears to be a loss in the market share to competitors based on product-price point. For the U.S. East market, there’s been no growth in air seat inventory.
In order to strengthen the market, there will need to be a focus on increasing air seat capacity out of the Mid-west, specifically in cities such as Minneapolis and Chicago. For Canada, seasonal increases of WestJet service from Alberta and Vancouver could help the market grow. As for the Japanese market, it appears that the currency exchange rate, fuel surcharge, consumption tax and cost of product is reaching the consumer threshold.
Uchiyama said that improvements in service and in-flight comfort will increase the attention given to Hawaii.
The Korean market is expected to decrease as overseas travel is anticipated to be soft over the Winter Olympics and World Cup periods, and the emergence of smaller companies offering attractive prices to other Asian markets are taking away from Hawaii travel.
In Europe, outbound business is projected to continue to grow, but Asia is competing with Hawaii’s share of long-haul business. Room availability and price points are surfacing as obstacles and Uchiyama also said Late Easter and the World Cup competition could effect travel during those periods.
Uchiyama also suspects the Latin American market to grow in 2014. Overall, visitor expenditures are up 2 percent and visitor arrivals are up 2.6 percent from 2012-13. That’s an increase from $14,250.20 in 2012 to $14,536.40 in 2013 for visitor expenditures, and up from 8,028,742 visitors in 2012 to 8,235,510 in 2013, according to information provided by HTA.
Uchiyama said continuous analysis and adjustments should be made to ensure that growth continues.
“We continue to grow, which is good, but how else can we sustain that growth? That’s important,” he said. He suggested that industry leaders focus on improving the experiences of visitors by marketing events like May Day, Mele Mei, Hawaiian Music Concert Series, Kamehameha Celebration, Aloha festivals.
He also said they’re working on bringing more flights to the Kona International Airport.
Visit www.hawaiitourismauthority.org for more information about tourism on the Big Island.