Rise in visitor spending offsets a slight drop in arrival numbers

A strong Canadian presence and a narrowing of post-tsunami losses from the Japanese market were not enough in July to offset a lull in visitor arrivals from the mainland.

While visitor spending rose for the 15th consecutive month in July, visitor arrivals fell 1.9 percent, according to a Hawaii Tourism Authority report released Wednesday. The drop for the month was the second in a row for Hawaii’s visitor industry, which until June had seen arrivals rise for 18 straight months.

"We hit a sputter in arrivals; however, expenditure growth is where we wanted to be," said David Uchiyama, HTA’s vice president of brand management.

The 668,193 visitors that came to Hawaii in July spent a total of $1.1 billion, up $55.8 million from a year ago. Average daily spending among these visitors rose by $13 to $177 a day.

"We had anticipated the pendulum swinging based on economic uncertainty and gas prices; however, we thought the swing would be more gradual in switching from arrivals to spending," Uchiyama said. "If not for the March 11 tsunami, our international markets would have helped offset this. We would have seen a huge difference coming out of Japan, Korea and China."

Instead, while arrivals from Canada grew 28.6 percent, they fell 9.2 percent from Japan, 6 percent from the U.S. East and 1 percent from the U.S. West.

Still, HTA is on track to meet its year-end goal of 7.3 million visitor arrivals and $12.6 billion in visitor spending, Uchiyama said.

"Barring any major negative developments, I think we’ll see rising arrivals and visitor spending throughout the rest of the year," he said.

Uchiyama said Japan is recovering and that markets like China, Korea, Australia and New Zealand are showing more interest in Hawaii.

"We anticipate continued growth through the fourth quarter and into 2012 with the continuation of China Eastern Airlines’ direct service from Shanghai and additional airlift and up-gauging of aircraft from Korea and Japan, (and) Australia’s Strategic Airlines launching of service from Brisbane and Melbourne," said Mike McCartney, HTA president and chief executive.

Interest is also high for Hawaii’s niche segments, like its honeymoon market. Kate and Jason Cik, who were married June 26, said Hawaii stacked up well against other destinations.

"The airfare was cheaper here than in Europe or the Greek islands," Jason Cik said. "The Caribbean was less expensive, but we wanted to see Hawaii."

Keith Vieira, senior vice president and director of operations for Starwood Hotels & Resorts in Hawaii and French Polynesia, said that while the booking pace temporarily slowed due to rising gas prices and economic fluctuations, most hoteliers are cautiously optimistic.

"The visitors that are coming here appear to be higher-spending visitors, and that’s good for Hawaii’s visitor industry," Vieira said.

Takahiro Ryuzaki, a student from Saga, Japan, arrived in Hawaii with an empty suitcase but spent the last few hours of his two-week trip filling it.

"Many of the students at the workshop (he attended) went shopping, but I am the best," he said, as he perused the merchandise at Aloha Wind Spinners at the International Market Place in Waikiki.

After some swift bargaining, Ryuzaki added a colorful mobile to his $2,000 collection of purchases, which included shoes, sunglasses and 10 T-shirts and Aloha shirts.

"The prices here are cheaper than in Japan so I can buy plenty," he said.

Bob Taylor, president and chief executive of Maui Divers Jewelry, said that even with the economic uncertainty, visitor spending has remained strong.

"With the yen at 76 to the dollar, Japanese spending is off the charts," he said.

August spending from Maui Divers’ westbound market is on pace to drop off about 5 percent from July, but Taylor said that if the economy stabilizes overall spending would stay strong.