Visitor arrivals, spending slip again

Hawaii’s once-burgeoning visitor industry has hit a rough spot with three straight down months, and a top tourism official expects the slide to continue through the first quarter.

Visitor arrivals and spending fell in November for the third month in a row, according to preliminary data released Friday by the Hawaii Tourism Authority.

The number of visitors to the state decreased 5.5 percent to 620,051 from the year-earlier period while spending fell 2.1 percent to $1.1 billion.

But despite another monthly decline, arrivals and spending in 2013 likely will eclipse last year’s records, according to David Uchiyama, the Hawaii Tourism Authority’s vice president of brand management.

In 2012, Hawaii attracted a record 8 million visitors who contributed to the highest visitor spending ever: $14.25 billion.

Through the first 11 months of 2013, visitor arrivals were 3 percent higher at 7.5 million from the year-earlier period, while expenditures were up 2.9 percent to $13.2 billion.

Still, those 11-month figures are not what the HTA had hoped for earlier this year when it released its annual targets.

In March, the HTA said it was projecting 8.51 million arrivals and $15.86 billion in spending. The HTA revised those numbers lower in August when it forecast 8.48 million arrivals and $15.32 billion in spending.

Rachael and Gabriel Taylor-Marsh of Los Angeles, visiting the islands with their 14-month-old son, Joseph, were closely watching their spending while attending a friend’s wedding.

"We’re definitely on a budget," Gabriel Taylor-Marsh said. "We’re here for a special reason. It’s just a once-in-a-lifetime opportunity, but at the same time you have to be mindful of what you’re spending. We seem to be blowing through it without living lavishly. You go through 100 bucks before you blink your eyes."

Between airfare, hotel accommodations and food, the couple said, they will likely end up spending more than $4,000 — their most expensive vacation to date — on their trip from Christmas Eve to New Year’s Eve.

"I mean it’s expensive here. Everything is at least 30 percent more. We’re definitely dipping into the credit cards," Rachael Taylor-Marsh said. "We’re not buying anything extravagant. We spend what we have to. We’re eating instead of getting massages. It was expensive to get here and we’re even staying in a hotel, which was the majority of our budget, and it isn’t that nice."

Uchiyama said factors that have affected travel and spending include unfavorable currency exchange rates, the increasing costs of oil, diminishing consumer confidence, fuel surcharges applied to airfare and consumption taxes in some markets.

"A lot of these factors are out of our control," he said. "Because we anticipated some of these things, we’ve already started to work with our marketing contractors in each market to see what we can do to help revitalize or stimulate the markets."

Tourism officials are crossing their fingers that more airlift — two additional flights out of Shanghai this month from China Eastern Airlines, three flights a week out of Beijing next month by Air China and three flights in April from Hawaiian Airlines — will offset declines early next year.

"We have an actual increase of service coming in the first half of the year which will, to some degree, counteract some of the things we are experiencing," Uchiyama said.

Last month’s poor performance was largely due to a 7.3 percent drop in arrivals from the U.S. West, the state’s largest tourism market. The decline resulted in spending from that region falling 7.5 percent to $368 million. There also were 30.5 percent fewer cruise ship visitors.

U.S. East visitor expenditures also fell. The figure plunged 15 percent to $201 million due to 9.2 percent fewer arrivals and lower daily spending. Average daily spending for the month of November, however, rose 3.1 percent to about $199 per person.

Japanese arrivals were comparable to a year ago, totaling 122,484, but the market recorded 5 percent lower daily spending to $309 per person and a shorter length of stay, which led to a 6.5 percent decline in Japanese visitor expenditures to $209.6 million.

"We saw this developing back in July where we pointed out that length of stays were starting to shorten and we saw consumers buying down in room category or type of accommodations from hotels to condos," Uchiyama said. "We see competition getting very aggressive in the same markets we’re in."

The state’s smaller Canadian market posted roughly the same number of arrivals as the year-earlier period at 44,650 and 9.2 percent higher daily spending, which boosted Canadian visitor expenditures 9.5 percent to $98.5 million.

There were 77,892 visitors from all other markets, roughly the same as November 2012.