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The Honolulu Advertiser
Posted on: Tuesday, November 13, 2001

Impact of crash weighed, tourism may be spared

By Frank Cho and Katherine Nichols
Advertiser Staff Writers

Waikiki beaches still are not jammed as they were before Sept. 11, but the sands are not nearly as empty now as they were the week after the attacks.

Bruce Asato • The Honolulu Advertiser

While the crash of American Airlines flight 587 yesterday in New York reverberated through Hawai'i's struggling visitor industry, tourism experts said they do not expect it to derail the industry's economic recovery.

The European-made Airbus A-300 was heading for the Dominican Republic when it crashed into a New York suburb. Investigators are reporting that early indications are the crash was the result of a mechanical problem and not a terrorist attack.

Still, the crash triggered concern that it could be another setback for Hawai'i's visitor industry, which is struggling to recover from the shock of the Sept. 11 attacks. If the crash was terrorist related, experts said it could devastate the travel industry and lead to more layoffs at Hawai'i hotels, restaurants and other businesses.

"If it is determined that it was a mechanical problem, any impact will be short-lived," said Joseph Toy, president of Hospitality Advisors LLC, a Honolulu consulting firm that tracks hotel occupancy.

Airlines and hotels reported double-digit drops in business immediately following the Sept. 11 attacks. They dipped again to a lesser degree at the start of the U.S. bombing campaign in Afghanistan and when the first anthrax reports surfaced. Hotel occupancy fell about 7 percent statewide after the U.S. started bombing Afghanistan and 4 percent following the the first week of anthrax scares, Toy said.

"We might see an even smaller drop here if it is determined that the crash was the result of a mechanical failure rather than some terrorist act," Toy said, adding that there is no reason to revise visitor arrival and hotel occupancy forecasts for this quarter or next.

"I think people here just want to get on with their lives," said Kelvin Bloom, chief operating officer for Aston Hotels and Resorts in Hawai'i, which has 35 properties statewide. "I suspect if the (cause of the crash) is found to be mechanical in nature, hopefully this will not have a negative impact on our continued recovery in Hawai'i."

Hawai'i's tourism industry is in no shape to endure another blow. Tourist arrivals are still 25 percent below a year ago. Arrivals from Japan, a key market for retailers, are down 44 percent, according to state counts.

"We just don't need any more bad news whether it's directly tied to terrorism or not," said Keith Vieira, senior vice president for Starwood Hotels and Resorts for Hawai'i and French Polynesia. "We need people to gain their confidence and get back to traveling."

"This is certainly not going to help the situation," said Barry Lewin, general manager of the Hyatt Regency Maui. "Anytime there is a greater fear in flying, we have the potential of being adversely affected because the only way to get to Hawai'i is by flying.

"We have to be positive," Lewin continued. "Had this been another terrorist attack, I think we would have to take a different spin, but it's business as usual for us right now."

To help calm fears, Lt. Gov. Mazie Hirono, standing in for the vacationing Gov. Ben Cayetano, released a statement, saying, "Our airports are open, and people can be assured that we are on top of the situation." Hirono met with Civil Defense, Department of Transportation and Department of Defense officials.

But tourists hold the key to whether the travel industry will dodge this latest potential setback.

Many people, like Elsa and Jim Donovan, a retired couple who live half the year in Chico, Calif. and the other half in Waikiki, are not allowing fear to alter their lives. "Naturally, you feel sad about it," Jim Donovan said. "But it doesn't change our plans."

Elsa Donovan agreed, but probably echoed the sentiments of several when she leaned over and whispered, "I hope they bring the Independence (which halted service last month when its parent company filed for bankruptcy) back. I think a lot of people would feel more secure."

Kaana Shergold and James Moore, visiting for three weeks from the United Kingdom, said their attitude was no different than it was after the Sept. 11 terrorist attacks.

"We thought about canceling (at that time)," admitted Shergold, who said the media saturation added to her fear. But they checked the Internet daily for news in Hawai'i until they felt comfortable that "everything seemed to be OK."

Moore said yesterday's tragedy made them feel a little "edgy about flying," but if the American Airlines crash had occurred before their trip, they would have come anyway. "You can't just stay stuck at home and not do anything," said Shergold.

But Michele Lamanski, a Los Angeles resident staying in Waikiki, said she "might have waited a little" to travel had yesterday's accident occurred before her trip.

Her companions disagreed.

"We would've come," said Jackie Graves, also of Los Angeles. Her husband Tim, said airplanes are still the safest way to travel.

Japanese tourists may be a bit more skittish.

Takako Oshima, a sales associate at Hermes in the Royal Hawaiian Shopping Center, said news of the latest crash will not play well in Japan.

"It's very bad for Hawai'i," said Oshima. She said Japanese shoppers tell her that "every day the TV shows (in Japan) say that that the U.S. is very dangerous."

The Aston Hotel's Bloom said he hoped the government would find the cause of the accident sooner rather than later. He said eliminating terrorism as the cause of the accident could convince people who are wary of flying because of terrorist threat to take a trip that they have been contemplating.