Tourist destinations feeling drop in Japanese travel
| • | Japan's jobless rate, deflation worsen |
By Tim Kelly
Bloomberg News Service
TOKYO — This time of year, Vangelis Papas is usually busy guiding spendthrift Japanese tourists around the cathedrals and opera houses of Prague and Vienna. This week he's in Tokyo in search of a market that went away.
Bloomberg News Service library photo
"We've lost 80 percent of our customers," said Papas, general manager of Hungary-based Euroguide coach tours. While Japanese are canceling in droves, those from China are snapping up bargain offers. "If they get lower rates, they don't mind, they travel," he said.
Jamie Bernal, left, had fewer Japanese tourists to greet at Honolulu International Airport last month than in early September. Hawai'i is only one of many destinations feeling the loss of free-spending visitors from Japan since Sept. 11.
Last year a record 17.8 million Japanese ventured abroad, helping to fill handbag boutiques, sightseeing tours and hotels from Paris to Sydney and New York. The second-biggest economy provided two-thirds of the foreign tourists from the Asia-Pacific region to the United States, spending an average of $164 a day, 80 percent more than the typical German visitor.
That gusher is now spluttering. Since the Sept. 11 terrorist attacks, Japanese tourists have canceled about half their planned holidays in the United States, Singapore and other markets. Hawai'i has been hit hard, with visitors from Japan off as much as 60 percent since the attacks.
That is leaving Japan Airlines Co. and other carriers struggling to stem losses, cutting routes, and setting back the industry's recovery.
Elsewhere in Asia, airlines and travel agents are reporting the first signs of a revival. Korean Air Co., that country's biggest carrier, said it is seeing demand pick up this week, including to U.S. destinations such as Los Angeles.
Hong Kong-based Fellington American Express Travel Services Ltd. said November sales are up 10 percent to 15 percent from October, though still off more than 30 percent. "It's just a little rebound," said Lily Agonoy, the agency's assistant general manager.
Japanese travel companies would be happy for any recovery.
Narita international airport in Tokyo said yesterday it handled 36 percent fewer departing passengers in the period Nov. 1-20 than a year earlier. The drop was more than the 32 percent decline for October, and included 41 percent for Japanese passengers. Narita accounts for half of Japan's international air traffic.
Efforts to entice Japanese to travel, such as free hotel stays and steep discounts, have yet to make much impact.
For travel to Hawai'i — the favorite destination for outbound Japanese — there are a "lot of cheap products, but still it cannot recover," said Koji Shinmachi, president of Jalpak Co., a travel agent unit of Japan Airlines.
Japan Airlines has cut 9 percent of its seat capacity on overseas routes until the end of March, including 28 percent on trans-Pacific routes. It will fly 51 times a week to Hawai'i in December, 27 flights fewer than originally planned.
JTB Corp., the country's largest travel company, is offering a five-day, three-night tour to the island chain for 49,800 yen ($404), compared with a low of 66,000 yen before the attacks, said company spokesman Hiroshi Ueno.
Trip cancellations may reach as much as half through the end of March, said Isao Matsuhashi, president of JTB. Still, "we hope for a recovery from the new year," he said at an international conference in Tokyo this week held by the Japan Association of Travel Agents.
In an effort to boost travel to Hawai'i in particular, a group of Japanese travel executives and local travel industry experts will hold a daylong tourism conference in Honolulu early next month. Participants include 40 executives from the Japanese travel industry, including chief executives of 20 top travel companies responsible for about 75 percent of tourism sales in the Japanese market.
Japanese reluctance to travel is hurting the economies of Singapore, Australia and other Asia Pacific countries.
In Singapore, tourism authorities said the number of Japanese visitors fell 51 percent last month, amid an overall decline of 11 percent.
Australia reported a 25 percent drop in visitors from Japan in October, its lowest tally in 2 1/2 years, according to the Australian Bureau of Statistics.
Those that are coming are bringing less, said Jessica Li, who sells jewelry at Tiara Jewelry in the shadows of the Sydney Opera House. Average purchases of opals and other trinkets are now less than A$200 ($100), down from A$1,000.
"Before, young people only bought cheap things and older people bought more expensive things," Li said. "But now both of them are buying cheaper things."
Air New Zealand Ltd. said it is cutting fares to encourage Japanese tourists after Tourism Minister Mark Burton said 21,000 fewer visitors from the country are expected during the next four months. The government has agreed to spend an extra NZ$2 million ($825,000) on marketing in Japan.
Jalpak's Shinmachi blames the reluctance to travel on group conformity. "It's not a matter of price, it's the psychology," he said.
"Do like your neighbor does is still quite prevalent" in Japan, Haruo Shimada, a Keio University professor and economic adviser to Japanese Prime Minister Junichiro Koizumi, told the international gathering. For the same reason, any recovery should be rapid, he said.
Others share the hope of a mass turnaround.
"Japanese travelers just need time," said Hiroshi Sawabe, Asia Pacific director of public relations for the Los Angeles convention center and visitors bureau. "Once the newspapers start devoting more time to (Prime Minister Koizumi's) budget cutbacks and less to the war in Afghanistan, they'll start flooding back."
To that end, Japan Airlines has said it will fly 60 representatives from the Japanese media to report on the Honolulu tourism conference and cover the JAL-sponsored Honolulu Marathon on Dec. 9.
"We are hoping that media coverage of this event back in Japan will help prime overseas tourism demand by demonstrating to the traveling public that it's time to get back to normality and that we live in a safer, more secure world," said JAL spokesman Geoffrey Tudor.
