Hawaii visits not expected to challenge last year's boom

HONOLULU -- Travel agents and package wholesalers booking Hawaii vacations said business looks good for the year, even though the Hawaii Tourism Authority downgraded its visitor arrival, spending and length-of-stay targets for the year due to gloomy economic predictions.

The HTA's new figures for 2001, revised from November 2000, show little growth from last year's record numbers.

The biggest revision in visitor numbers for 2001 -- and the most unpredictable -- will be in visitor spending, according to the HTA.

Per person spending per day, which is "the biggest wild card out there," according to Hawaii Visitor & Convention Bureau president Tony Vericella, is targeted to grow slightly by 0.5% to $157, down from an earlier prediction of 10.9% to $174 a day for this year.

Visitors from the East Coast were targeted to spend $201 per day in 2001, which was an 8% increase compared with last year, but now the HTA is predicting those visitors will spend $187 a day this year, which is a 0.5% increase compared with last year.

No growth on top of a record year is still very good business, wholesalers and agents on the mainland said.

Pleasant Hawaiian Holidays saw a 14% increase in revenue from January through April as compared with last year, but "we are watching it," said a spokesman.

And Pleasant, seeing some signs of eroding consumer confidence, has stepped up advertising and incentives.

Pleasant will add more companion air fare deals into the West Coast markets and has added a kids-fly-free promotion to its two flights weekly from Chicago and New York.

Bookings for May are a little soft but firming up, and the summer looks good, too, the spokesman said.

Pleasant will go ahead with plans to increase air service this summer from San Francisco (from six flights a week to eight) and from Los Angeles (from seven flights a week to nine).

Pleasant brought 450,000 passengers to the islands in 2000 and was expecting 500,000 this year, "but we're not holding out for that now," said the spokesman.

At Carlson Wagonlit Travel/On the Go in Santa Ana, Calif., operations manager Sylvia Vargas is expecting 2001 to be a good year despite the economic news of late.

On the Go, with 12 offices in Southern California, sells Pleasant to Hawaii exclusively.

"We have a very positive outlook for this year in Hawaii," said Vargas.

"Last year everyone booked last minute and were disappointed when they couldn't get what they wanted.

"This year people are calling in and requesting information early."

Vargas said that for an industry that is worried, hotel prices are "just OK, and air fare to the outer islands is really expensive."

Nancy Acord, a meetings and incentives specialist with Maritz Travel Co. in Fenton, Mo., said Hawaii bookings so far are fewer this year than last, "but it's not off that much."

"A lot of it seems to be that last year was the millennium year, and everybody just wanted to go last year," said Acord.

And with people booking groups on such short notice these days, it's tough to make predictions, she added.

At Classic Custom Vacations, a spokeswoman said the company has not changed its marketing strategy in light of the bad economic news and that "Classic is very solid this year."

Classic is taking the view that last year's business to Hawaii was such a boom that it would be tough to beat.

On the other hand, things could always get worse.

"If the stock market continues to erode, and consumer confidence continues to erode, then certainly it will have an effect on spending," the spokeswoman said. "But people have gotten used to taking vacations."

The spokesman said there has been a falloff in corporate meetings in the travel market overall, but that leisure travel remains strong.

But in Hawaii, hoteliers, tour operators and those who market the state are sounding worried.

Before unveiling the new targets to the board, HTA member David Carey, who also is president and chief executive officer of Outrigger Hotels and Resorts, gave an overview of market intelligence gathered from meetings with industry leaders held prior to the HTA board meeting.

Advanced hotel bookings for May and June, he said, were "significantly down from last year."

During the month of February, "which is usually one of our best months," said Carey, "we already saw [downward] changes in our visitor statistics."

Visitor arrivals from the U.S. West Coast fell by 2% in February compared with February 2000, according to the Hawaii Department of Business, Economic Development and Tourism.

Arrivals from the East Coast were down 4.9%.

Total arrivals for all markets were down 4.4%.

HVCB president Vericella, whose organization is under contract with the HTA to market the state to tourists and meetings planners, told HTA members that marketing dollars earmarked for later in the year to snag leisure travel and meetings business have been rescheduled to be used now.

On the Big Island, the Kona Kohala Resort Association in July will call on top-producing travel agents in an effort to spur business, which is a first for the group of eight hotels, according to associa- tion director Sharon Sakai.

"This is a program we haven't done before, and it's to drive business," said Sakai.

"We want to be top-of-mind with travel agents. It's just an indicator of what the resorts here want to accomplish."

Bringing some perspective to the situation, David Preece, vice president North America for the HVCB, said "there's something that has often gotten lost in these discussions about the economy: If we achieve the current projection of essentially flat growth for 2001, we will match the all-time record performance of 2000."

"We saw this [economic slowdown] coming toward the end of 2000 and have been making marketing adjustments all along," he said.

"A few industry segments may see some decline this year, but most tourism companies would be satisfied with the same performance this year that they had last year."

A variety of economic factors are having an impact on potential visitors.

A "meltdown in the dot-com sector will hurt visitation from the West Coast," said Carey, while "the Wall Street drop affects wealth perception, and wealth perception hurts people's ability to come here."

During discussion of the revised visitor targets at HTA's monthly meeting, members said that the new targets agreed on will be a challenge to meet.

The 2001 targets originally came out in November.

"I'm not sure these numbers are achievable unless we have some good programs in place," according to Peter Schall, managing director of the Hilton Hawaiian Village and an HTA member.

"We see how the market is changing. Everyday there are more layoffs, and companies are canceling meetings. We can go on marketing the way we are now or we can be proactive."

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