COVID-19 has infected Hawaii’s visitor industry, which is starting to see symptoms ranging from travel cancellations and anemic bookings to declining air seats to plummeting hotel occupancies — some as low as 10%.
Volatility in Hawaii’s tourism industry has increased as new developments have made some travelers anxious. On Sunday, Hawaii had a second person test positive for COVID-19. The U.S. State Department also has issued a warning for older adults and travelers with underlying health problems in the U.S. to avoid traveling on cruise ships and long flights.
“Everyone in Hawaii’s visitor industry is starting to see decreases, some more than others. It’s been the most challenging for those that are heavily reliant on the Asian markets, but we are starting to see some incursion into the domestic market,” said Mufi Hannemann, Hawaii Lodging & Tourism Association president and CEO.
It was so quiet in Waikiki on Monday that Ross Baquillos, a visitor from Sydney, and his family didn’t have to wait to take a portrait in front of the Duke Kahanamoku statue at Kuhio Beach.
“The coronavirus is a big concern in Australia. We thought about canceling, but we had planned the trip way in advance,” Baquillos said. “We checked the reports on Hawaii and decided it didn’t look that bad. Now that we’re here, we’re enjoying it. We’re glad we came.”
But judging from hotel occupancy declines, some visitors are canceling trips and others aren’t booking. Hawaii hoteliers report that occupancy has dropped from a high of about 70% to a low of about 10%. Earlier this year statewide occupancy ranged from a high of about 90% to a low of about 80%.
Impacts have been steadily rising since February with the international spread of the new coronavirus. Additional declines have crept into the market along with coronavirus’ rapid spread in the U.S., where the COVID-19 death toll has climbed above 20. It hasn’t helped that most of the U.S. deaths from COVID-19 have been in Washington, a state that is Hawaii’s third-largest domestic visitor source market.
Jack Richards, CEO and president of Pleasant Holidays, a Hawaii wholesale travel seller, said that “last week was a turning point, and there were lots of cancellations.”
Even so, Richards said Hawaii is holding up better than a lot of markets. For instance, Pleasant’s Hawaii business has dropped, but it’s still up by single digits over last year.
But there’s still plenty of coronavirus uncertainty to go around, and related Wall Street plunges aren’t helping the situation. Both could cause further erosion of Hawaii’s group business, which already lost the Honolulu Festival. Also, organizers postponed the Festival of the Pacific Arts & Culture, or FESTPAC, an event that drew 90,000 to Guam when it was held there in 2016.
Teri Orton, Hawai‘i Convention Center general manager, said cancellation inquiries have risen. However, so far all 10 large citywide bookings are coming to the center this year.
“We’re encouraging groups to consider postponing rather than canceling,” Orton said. “We haven’t gotten any cancellations yet. But we have been told that attendance is down for a few groups, which could cause hotels to lose some rooms and us to lose some space as well as food and beverage revenue.”
The airline industry has hit turbulence, too — which is never a good thing for a long-haul destination like Hawaii, where the majority of visitors come by plane.
It was bad enough that United, Korean, Asiana and Hawaiian airlines already had started slashing service to respond to dropping demand. Then, the Hawaii Department of Health reported Sunday that male senior who tested positive for the state’s second COVID-19 case flew back to Honolulu from Washington on Hawaiian Airlines Flight 21 on March 4.
Hawaiian spokeswoman Tara Shimooka said the carrier has provided flight information to the CDC, which works with health departments in Hawaii and elsewhere to notify passengers “considered to have had close and prolonged contact with the patient.”
Out of an abundance of caution, Hawaiian also instructed crew members to stay home and monitor their health through two weeks from the date of the flight, Shimooka said.
“None of the crew members from HA 21 on March 4 have reported feeling ill,” she said.
Shimooka said the plane was “thoroughly sanitized upon arrival by a team of 16 cleaners who utilized disinfectants that effectively kill most viruses, including COVID-19,” and “went back to service the same day.”
“The subsequent routes flown by this particular aircraft is not part of the CDC’s investigation,” she said.
Shimooka said Hawaiian has updated its first-quarter metrics “in light of the uncertainty about the impact of COVID-19 on demand for the remainder of the quarter.”
Hannemann said Hawaii’s visitor industry is meeting with government officials to address safety and start stemming the losses for an industry that employs about 216,000 people statewide, brings in more than $17 billion in visitor spending and contributes another $2 billion in statewide tax revenue.
“The airline industry is running deals, and the hotels are looking at encouraging kamaaina travel. We’re in survival mode, and we’ll do everything that we can to keep our workers employed across the visitor industry,” he said.
Kelly Sanders, vice president of operations for Highgate and a Hawaii Tourism Authority board member, said the industry has responded to travelers’ concerns about safety. After the first coronavirus reports from China, Highgate installed sanitizers throughout its hotels, Sanders said. All housekeepers have their own bottles of sanitizer, and Highgate has purchased new cleaning products and expanded its cleaning schedules, he said.
Sanders said some travelers are responding to increased safety efforts and specials. Still, Hawaii tourism’s downturn since the last four days of February has been significant, he said.
“I would say there’s been an anywhere from 30 (percent) to 40% downturn in arrivals,” Sanders said. “Our occupancy (at Highgate) went from about 90% to as low as 60%, although it’s 70% or 80% at some properties.”
Southwest Airlines CEO Gary Kelly, in a Thursday interview with CNBC, compared the bookings decline to what Southwest experienced during past recessions and Sept. 11, 2001.
“9/11 wasn’t an economically driven issue for travel — it was more fear, quite frankly,” Kelly said during the CNBC interview. “And I think that’s really what’s manifested this time. … It has a 9/11-like feel. “
Sanders agreed that Kelly’s statement could prove to be a “fair guess.”
“So I think it has the potential to be a 9/11 event in terms of travel. … Every day that goes by that we don’t see people traveling just declines our forward-looking pace,” he said.
IF YOU ARE SICK
>> If you develop a fever and a cough and are having difficulty breathing, or have been near a person with COVID-19, or you live in or have traveled to an area that has an ongoing spread, you should call your health care professional with your information, and they can work with the state Health Department to determine whether you need to be tested.
>> If you have mild symptoms, you should confine yourself to your home and avoid going to public areas except for seeking medical care. Do not go to work or school.
>> Separate yourself from people by staying in a specific room and also avoid contact with pets, which can become mildly infected.
>> Call ahead before visiting your doctor so they can take steps to keep others from being exposed.
>> Wear a face mask when you are around other people or pets, when sharing a room or a vehicle and before entering your doctor’s office. The people who live with you should not stay in the same room, or they should wear a mask if they enter your room.
>> If illness worsens call your health care provider or 911 and let them know you are being evaluated for COVID-19; wear a face mask before you enter the facility.
>> For more information, call Aloha United Way, 211, or visit the state Department of Health website at health.hawaii.gov/docd/advisories/novel- coronavirus-2019.
Source: CDC and World Health Organization