Visitor arrivals and spending climbed for the third month in a row in May due largely to gains from Hawaii’s larger domestic market as well an increase in air seats, according to preliminary statistics released Thursday by the Hawaii Tourism Authority.
Total May arrivals rose 9.3 percent to 709,671 visitors, while spending grew 10.4 percent to $1.2 billion.
“Coming off of three record-breaking years for Hawaii’s visitor industry, the steady growth in expenditures is a positive sign that this year will be another successful one for tourism,” said George D. Szigeti, the HTA’s president and CEO.
That’s true, said Barry Wallace, executive vice president of hospitality services for Outrigger Enterprises Group. However, some segments of the market are doing better than others at offsetting what started as a weak year.
“We’ll be doing really well if we can match last year, which was a record year,” Wallace said. “January, February and part of March were slower than last year, and we’ve got some ground to make up. Luckily, the second quarter through the rest of the year is looking much stronger.”
Air seats to Hawaii in May rose 8.8 percent from the year-ago month. Gains from in seats from North America offset fewer seats from Japan and other Asian nations.
May arrivals from Hawaii’s core market, the U.S. West, grew 11.8 percent to 295,550 visitors. A 19.9 percent growth rate in spending from these visitors brought in $447.4 million in monthly visitor spending.
In May, U.S. West visitors filled more hotel rooms and more bed-and-breakfasts and nontraditional accommodations.
The trend toward staying at B&Bs or nontraditional accommodations, especially from Hawaii’s largest visitor market, has meant that performance has been less robust for the hotel sector than for other sectors, Wallace said.
A total of 146,337 U.S. West visitors stayed in hotels as compared with 2,968 who stayed in a bed-and-breakfast and 5,226 who stayed in a nontraditional rental.
“Numbers on the hotel side are lighter than they are for arrivals,” Wallace said. “Results have been disappointing for us in the hotel business. However, we have six different timeshare properties, and they are going gangbusters.”
Wallace said that despite the variances by industry, May performance in general continued to be driven by the domestic market.
“The domestic market, especially the U.S. West, really rings the bell for us,” Wallace said.
HTA also reported excellent demand from Hawaii’s second-largest market, the U.S. East. In May, U.S. East arrivals increased 6.5 percent to 153,418 visitors, the HTA said. While arrivals rose from nearly all regions, the largest growth was from the East North Central and West South Central areas. U.S. East visitor spending also rose to $302.3 million, a 7.5 percent gain from May 2014.
May arrivals from Japan, Hawaii’s third-largest visitor market, grew 3.6 percent to 112,486, but spending from the market was still down. Japanese visitors, who have been struggling with a lagging economy and unfavorable exchange rates, spent $167.8 million in May, a 3.1 percent decline from May 2014.
The challenges were also apparent in the 24.3 percent drop in honeymooners from Japan and the 33.7 percent drop in visitors from Japan who came to get married. Because Japan is such an important nuptial market, the drops lead to a 13.2 percent overall drop in honeymooners and a 19.8 percent reduction in those coming to get married.
“While the depreciating Japanese yen and drop in outbound travel from Japan has been affecting our largest international market, the recent announcement of pre-clearance at Narita Airport will help to boost travel from the market to the neighbor islands,” said the HTA’s Szigeti. “Coupled with Gov. Ige’s recent trip to Japan to meet with the prime minister and key tourism stakeholders, we look forward to seeing growth from this mature market.”
Although there are typically fewer Canadian arrivals in May than other months, the market contracted even more this May than it did at the same time last year. Canadian arrivals fell to 26,459 visitors in May, which resulted in an 8.7 percent decline in visitor spending. This May, Canadian visitors brought in $45.5 million in visitor spending.
Arrivals from the category “all other markets,” which include visitors from Oceania, Europe, Latin American and Asian countries outside of Japan, have smaller individual footprints. However, together they rose 15.9 percent to 110,671 with their combined expenditures climbing 11.9 percent to $238.3 million. Monthly arrivals from Australia, New Zealand, China, Europe and Latin America grew in May; however, arrivals from Taiwan were flat and arrivals from Korea dropped.
The monthly results also were helped by a 10 percent increase in meetings, conventions and incentives travelers. These 40,516 visitors helped fill hotel rooms, creating a better base of business for Hawaii’s visitor industry.
While 31.9 percent fewer convention travelers came in May, incentive traffic grew 70.6 percent.
William and Debra Goodwin. visitors from Dallas who came to Hawaii in June, say they know why this market is on fire.
“She’s been waiting her whole life to come to Hawaii,” said William Goodwin, who works for American National Life Insurance. “When we heard this year’s incentive trip was to Hawaii, it provided great motivation.”
The 98th annual Lions Clubs International Conference this week is expected to draw more than 20,000 delegates and their families to the isles.
The conference, which will be held from Friday to Tuesday on Oahu, is the largest convention scheduled to come to Hawaii this year.
Hawaii’s cruise ship market is still trending downward for the year; however, six out-of-state cruise ships with 11,087 visitors came in May, up 57.6 percent from a year ago, when 7,034 visitors arrived on four ships.
May results brought the five-month tally to 3.5 million visitors, a gain of 4.1 percent from the same period in 2014. Visitor spending in the five months also rose 2 percent year-over-year to $6.2 billion.
“Year-to-date, visitor spending has contributed $121 million more into the state’s economy compared to last year, and state tax revenue reached $660 million, up 2 percent year-over-year,” Szigeti said.