Covid-19: Tourism industry’s ‘new normal’ is still three to five years away, but operators not ready to ‘turn around’ and leave
The trans-Tasman bubble has given a silver lining to the tourism industry, but it could take up to five years for the sector to settle into what will be the “new normal.”
Since the start of the bubble on April 19, more than 237,000 people – including New Zealand passport holders – entered the country. However, many of those newcomers were believed to be visiting family and friends, rather than tourists exploring the country – which Tourism Industry Aoteaora (TIA) general manager Chris Roberts had expected.
So rather than the bubble providing a much needed financial boost to the industry, it had so far only given what Roberts described as a “huge mental boost”.
This was the case for Kaikōura Kayaks. Owner Matt Foy explained that before Covid, most of their customers were from the UK and the US – two markets that were still ‘far away’ being welcome in New Zealand without quarantine. The Australian market, for them, had always been rather small.
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“The Australian market is opening up, but it’s a bit more of a dribble than a torrent of Australians coming in,” Foy said.
When Thing talked with Foy, business was pretty quiet, which didn’t surprise him.
“We have always known that in Kaikōura, winter is a quiet time. Traditionally, if Australians travel to New Zealand, they tend to head for the slopes.
“We have more Australians visiting the Marlborough area at the end of the ski season.
Foy predicted that New Zealand tourism would experience a long recovery.
“I would say this will be the biggest recovery in New Zealand tourism that anyone can remember.”
Roberts went so far as to set a timeline for an industry-wide recovery.
He believed the industry’s “new normal” could still be in three to five years, provided global vaccinations were successfully rolled out.
“We expect a gradual reconnection with the rest of the world, as immunization programs roll out and new rules and procedures are put in place for world travel,” said Roberts.
Australian bubbles take a rollercoaster ride
Until the country reopens to the rest of the world, the industry would depend on the Australian market, which in 2019 was the largest international market – accounting for 40% of all visitors and spending $ 2.7 billion, Roberts explained.
But the Covid-19 outbreaks in Australia could cause travel without quarantine to be suspended in the blink of an eye, dealing another blow to the already injured industry.
This remained the case with New South Wales, which was still in the grip of a growing cluster. Non-quarantine trips with Victoria had also been put on hold following a spike in cases in the community.
Although disruptions were announced when the bubble was announced earlier this year, they caused a wave of nervousness within the industry when they occurred.
Roberts compared it to being “on a roller coaster ride”, Foy described it as “taking one step forward and two steps back”.
Foy explained that it was concerning and devastating that all the work and planning that went on behind the scenes as school holidays or long weekends approached came down to nothing.
“When this is not generated in revenue, it is a real concern and has a devastating impact on the exercise.”
The pandemic had cataloged the industry, creating only a small window of opportunity to capitalize on tourists during holiday periods. Just missing one of those windows “really hurts,” Foy said.
Despite these disruptions, New Zealand’s ski season has got off to a promising start. Paul Anderson, managing director of New Zealand Ski, the company that manages The Remarkables, Coronet Peak and Mt Hutt slopes, said Mt Hutt had “solid numbers” coming from the domestic market.
Planes full of tourists landed in Queenstown when the bubble was re-established earlier this month, giving the runways some traffic. But the overall numbers were down about 30% from what they had expected. Anderson said this was due to the border closures.
“We are seeing some good numbers over the weekends, but as expected with the border closed at NSW, our largest Australian market, the numbers are down from forecast.”
Anderson was hoping those who couldn’t come due to the NSW shutdown would book again when the restrictions were lifted.
“It’s terrible over there”
Sadly, Roberts was aware of tourism operators being forced to downsize or put their business into ‘hibernation’ just to get out of the other side of this pandemic. Few of the TIA members had alerted them to permanent shutdowns, suggesting that most expected to resume their activities when they could.
Some New Zealand-based travel wholesalers Foy worked with before Covid-19, however, had decided to shut down for good, which he said had to happen.
“It’s terrible over there, there are a lot of people hanging on.”
At Kaikōura Kayaks, Foy was able to keep his entire team employed on “strong contracts” thanks to the funding he received from the government.
“We are supported for the next year and a half,” he said. Thing.
But they still took a hit, revenues were down 50% compared to a normal year.
Despite the daunting future that awaits them, Foy remains positive. He said the industry is just not ready to “turn around and cease to exist”.
“We’re very positive about where we are at and what we’ve accomplished with this and going forward and just building on what we have… We’ll go as long as it takes.”
“I hope in a few years we will come back to it and say ‘wow, we did it’.”
Foy was already in contact with a UK incoming tour operator to discuss rates for the next few years and email a cruise line interested in their tours.
“There’s a lot of interest in New Zealand, which… keeps us going. “
New Zealand’s successful response to Covid-19 and the notoriety it has received around the world would hopefully make it a desirable place to visit once international travel resumes.
“When the doors open, there will be a flood of people, and we’ll be ready and waiting,” Foy said.
Until then, these businesses would depend on the net of Australian tourists and Kiwis exploring their own backyards.