With most students on summer breaks from school, families are flocking to Hawai'i for vacations, filling hotels and packing tourist spots.

The months from June to August are the industry's most important season, contributing nearly 28 percent of the $9.8 billion in revenue generated by visitors each year.

It will be a busy summer as usual for many Neighbor Island tourism businesses, thanks to strong travel from the Mainland and more nonstop flights.

"There has been an increase in the amount of airline seats into Maui in particular, and into Hawai'i in general, so that has added to the interest in this coming summer as well as the fall," said Patrick Blangy, director of sales and marketing at the Grand Wailea Resort on Maui.

Waikiki hoteliers, retailers and tourist attractions are expecting more tourists for the summer season as well, but they also continue to struggle with a significant drop in Japanese tourists since the Iraq War and the outbreak of SARS.

"The summer's turning out to be OK. Not great, but OK. If Japanese came back, it would be great," said David Carey, chief executive of Outrigger Enterprises Inc., which has properties throughout Hawai'i.

The summer demand in domestic travel has made the Neighbor Islands, particularly Maui, rising stars in Hawai'i's tourism industry, eclipsing long-dominant O'ahu.

O'ahu still draws the most visitors — 293,085 last month, or 62 percent of the state's total.

Increasingly, however, visitors are overflying O'ahu to visit the other islands.

Maui is "still the first choice of the consumer," said Stan Brown, vice president for Pacific island operations for Marriott. The chain runs hotels on O'ahu, Kaua'i, Maui and the Big Island.

The shift to the Neighbor Islands has grown clearer in recent airline flight schedules, and this summer is cementing the trend.

Some airlines have restored flights for the summer, and nearly 35 percent of nonstop flights between Hawai'i and the Mainland are going to the Neighbor Islands, according to OAG airline statistics from the Hawai'i Visitors & Convention Bureau.

The strength of tourism from the Mainland is felt at Los Angeles travel agency TravelStore, where leisure marketing and sales

vice president Dan Ilves said bookings to Hawai'i are up by about 25 percent over last year. The reason: "Nobody wants to go to Asia, and people are still a bit scared to go to Europe," he said.

"The economy was a really big issue, but now that the market is improving and now that summer's here ... people are finally coming out of the woodwork and deciding to travel because they've been postponing their decisions for the last three months," Ilves said.

Much of this pent-up demand has benefited the Neighbor Islands. Maui and Kaua'i have done particularly well, but the Big Island also gets a customary boost from visitors who can't get into packed Maui hotels during the summer.

The season isn't looking as bright for O'ahu, which has depended on international visitors for more than 40 percent of its visitor count.

"It's been an interesting but painful study in contrast, Waikiki as compared to the Neighbor Islands," said Kelvin Bloom, president of Aston Hotels & Resorts that operates properties on O'ahu, Maui, Kaua'i and the Big Island.

"Summer will be relatively strong for the Neighbor Islands whereas Waikiki struggles as it regains its footing."

Brown expects Marriott hotels in Waikiki to post occupancy levels in the 75 percent to low 80 percent range for the rest of June and July. Maui and Kaua'i properties will enjoy occupancy rates in the high 80 percent range.

"Waikiki, we would expect to be 10 percent higher," Brown said.

Tourism executives cheered the news that Japan Airlines is adding more flights to Hawai'i for July, but they also note that the schedule is not fully restored to the days before the war and SARS.

As far as Japan is concerned, the added flights are "just partially adding back on what was taken away earlier in the year," according to Bloom, who said: "It still has a very long way to go."

Japanese passenger arrivals have been down by more than 30 percent for months and that has continued through June.

The number of seats from all locations listed in airline schedules for June is down 4.9 percent compared with the same month last year, according to the visitors bureau.

That includes a 6.2 percent increase in seats from the Mainland and a 33 percent drop from Japan.

But there is some cause for hope: July figures are better, with a 0.5 percent increase in total airline seats over last year and with August schedules showing a 3.2 percent increase in total seats.

The numbers are generating measured optimism within the Japanese travel industry.

Ryokichi Tamaki, vice president of tour wholesaler Jalpak International Hawai'i Inc., a JAL group affiliate, said Japan Airlines and Jalpak are launching a summer promotion for Hawai'i featuring a popular Japanese band.

Japan Airlines is investing $10 million into the summer marketing of Hawai'i, and most wholesalers and travel agents are also offering summer specials. One advantage is that Japanese travel agents have had a limited selection of destinations to sell because of the SARS impact on travel in Asia, particularly China. Hawai'i benefits, and the pace of travel bookings in Japan has been improving.

"Slowly they are feeling more comfortable in traveling," said Gilbert Kimura, director of passenger and cargo sales in Hawai'i for Japan Airlines.

Still, concerns linger that Japanese travel to Hawai'i is far from healthy even with a summer bounce.

"We're still much lower than last year," Tamaki said.

Many in the tourism industry are looking toward the fall and winter for a full recovery in the Japan market, but they say travelers are making reservations later and later, making it difficult to forecast the future in the tourism industry.