A drop in passenger arrivals of just 27 percent last month compared to September of 2000 is “remarkable” to Bank of Hawai’i Chief Economist Paul Brewbaker, especially considering the fact that for three days there were virtually no flights into
A drop in passenger arrivals of just 27 percent last month compared to September of 2000 is “remarkable” to Bank of Hawai’i Chief Economist Paul Brewbaker, especially considering the fact that for three days there were virtually no flights into or out of the state.
In February of 1991, during the Persian Gulf War, the state’s visitor count declined 22.4 percent.
“The September 2001 number are remarkable given the fact that for three days there were virtually no flights to Hawai’i,” said Brewbaker.
“Because events following the September 11th terrorist attacks on the U.S. continue to unfold, it is too early to tell whether the Gulf War experience represents an exact analogy,” said Brewbaker. Last month, he told a packed house at the Princeville Resort ballroom during a Kaua’i Chamber of Commerce quarterly membership meeting that the U.S. response to the terrorist attacks would serve as a calming event to uncertainties in markets, and in investors’ and travelers’ minds.
He could not predict then what impact a prolonged U.S. response would have on those uncertainties, especially where it concerns transpacific travel to Hawai’i. “However, the data thus far illustrates the resilience of tourism in general and in certain market segments,” he said.
His feelings were echoed by Tony Vericella, president and chief executive officer of the Hawai’i Visitors and Convention Bureau.
“Key signs are emerging that indicate Americans are feeling increasingly comfortable about resuming travel to the Hawaiian islands,” said Vericella.
“Booking activities have picked up, and many of those travelers that initially canceled trips have rebooked for later dates,” Vericella continued. “Furthermore, tour wholesalers have returned to advertising, and are already noticing positive results for the coming months.”
It doesn’t hurt that airlines serving Hawai’i from the mainland are giving potential customers exactly what polls have shown will lure them back to traveling: drastically reduced fares, double frequent-flyer points or miles, and other incentives. Increased security and reduced fares were the two most commonly uttered responses in nationwide polls conducted recently.
Kaua’i and the other neighbor islands before September 11 had enjoyed unprecedented attention from major carriers serving the state, Brewbaker observed.
Prior to September 11, U.S. air carriers had been aggressively adding nonstop flights to the neighbor islands, Brewbaker said. On Kaua’i, Maui and the Big Island, scheduled seats increased 35.1 percent between January and August of this year.
In September, passenger arrivals on the neighbor islands declined only 4 percent from the previous year, including the three days in which travel to Hawai’i virtually stopped. Neighbor island passenger levels appear to be returning to levels similar to a year ago, the state’s strongest tourism year ever, he observed.
Indeed, the United Airlines’ daily nonstop flights to Lihu’e Airport from Los Angeles and San Francisco have been averaging over 80 percent occupancy, and have not been included in the rash of flights cut from various carriers’ mainland-to-Hawai’i service.
According to information gathered by the Kaua’i Economic Development Board, the island’s car-rental companies are seeing 90 percent or more of their fleets on the roads, and timeshare units are reporting occupancy rates in the 90s as well.
The Kaua’i Visitors Bureau, Hawai’i Hotel Association Kaua’i chapter, Kaua’i Chamber of Commerce, Hawai’i Tourism Authority and KEDB have joined forces to provide regular updates on the state of the island’s economy in the aftermath of the terrorist attacks.
Overall, Kaua’i shopping centers that are dependent on visitor traffic have seen sales drop by 25 percent to 40 percent, but aren’t making drastic changes, the KEDB report states.
Businesses with a higher dependence on residents are seeing gradual improvements in sales from past weeks, the report continues. Businesses with higher visitor dependence are still down 25 percent to 35 percent compared to sales levels of a year ago, they report.
There have been layoffs on the island, mostly in service and hotel sectors of the economy (please see the chart).
The state’s largest provider of medical insurance, Hawai’i Medical Service Association (HMSA), has announced that its board has approved a $50 million program to help employees and businesses impacted by the terrorist events and repercussions.
The September 11th Member Protection Program offers a special subsidy to help maintain coverage for HMSA members laid off from September 11 through the end of this year who do not have access to alternative health coverage.
For more information on that plan, please call toll-free 1-800-643-3083.
