<![CDATA[tourismanalytics.com - News Articles]]>Wed, 13 Nov 2019 11:42:55 -0500Weebly<![CDATA[Despite Dorian, travel to the Caribbean keeps growing.]]>Thu, 07 Nov 2019 21:51:13 GMThttp://tourismanalytics.com/news-articles/caribbean-tourism-continues-to-grow-forwardkeys-reveals-forward-bookingsA study, undertaken by ForwardKeys, the travel analytics firm, has revealed that despite the recent ravages of hurricane Dorian and other huge storms in the Caribbean, tourism will continue to grow. The results of the study were presented at a Caribbean Tourism Organization-organised news conference at World Travel Market on November 6th.

Forward bookings for the important winter season, 1st November to 31st January are currently 1.6% ahead of where they were at the equivalent point last year. Currently, bookings from the USA, the most important source market are 3.0% behind but bookings from all the other major source markets are ahead, France 9.8%, the UK 0.9%, Canada 8.2%, Argentina 8.1% and the rest of the world collectively 3.2%. The current leader is the Netherlands, 42.1% ahead.
However, the outlook is not universally positive. Forward bookings to the top destination in the Caribbean, the Dominican Republic, are currently 14.2% behind and those to the Bahamas and Aruba are 6.4% and 1.4% behind respectively. Encouraging growth is seen from Puerto Rico, 28.0% ahead, but that is really a recovery story, as tourism to the island was hit hard by hurricane Maria in December 2017.
​Looking back on the first three quarters of the year, travel to the Caribbean has grown healthily, 5.2% up on the same period in 2018. The star source market has been the USA, with 56% share and 9.0% growth. However, other major origin markets have been mixed, with France down 2.2%, the UK down 4.7% and Argentina down 5.7%. However, Canada has been up 15.3%, Chile up 17.0% and the rest of the world up 1.4%.
​This season’s most devastating hurricane, Dorian, which came at the end of August and early September, ravaged the most northerly parts of the Bahamas but left other parts relatively undamaged. The result is that some parts of the country saw a drop in arrivals, where others experienced a significant increase. Travel to Freeport and Marsh Harbour in September fell dramatically, by 50.9% and 67.9% respectively. The impact on Nassau, the capital and the largest airport, was more limited, as arrivals went down by 7.4%. Travel to Georgetown and North Eleuthera was up, 10.6% and 30.7% respectively.
​Hurricanes have been a major scourge, affecting travel to the Caribbean in recent years, with some islands left badly damaged. ForwardKeys research shows that recovering from the impact of a major hurricane can take years. So far, it has taken Puerto Rico 15 months to reach 70% of pre-hurricane arrivals and it has taken St Maarten 20 months. In the case of the Bahamas, ForwardKeys expects the recovery to take less time because the initial rebound in both post-hurricane arrivals has been stronger: just one month after the hurricane, the Bahamas has reached 80% of pre-hurricane arrivals.
Joy Jibrilu, Director General, The Bahamas Ministry of Tourism said: “The Bahamas is an archipelago with more than 700 islands and cays, spread over 100,000 square miles of ocean. Because of our unique geography, a hurricane can impact some parts of the country, but leave other parts untouched. That is the case with Hurricane Dorian. The majority of our country remains beautiful and palm-fringed, with unspoiled beaches in several shades of white and pink. We would like everyone to know that the best thing they can do for us right now is visit. Our beautiful island nation is ready to welcome you.”
Olivier Ponti, VP Insights, ForwardKeys, concluded: “What we have seen in recent years is that the Caribbean is an incredibly popular destination. When some parts of it have been hit with horrendous hurricanes and other issues, tourist did not give up on their desire for a holiday in paradise; they chose other parts of it to visit instead. We saw that syndrome earlier this year, when stories in the US media about tourists who had died in the Dominican Republic, caused bookings to collapse; however, other islands, most notably Jamaica, the Bahamas and Aruba saw a visitor surge.”
<![CDATA[Confidence Levels Remain High; Consumers Unlikely to Curtail Holiday Spending.]]>Tue, 29 Oct 2019 21:46:45 GMThttp://tourismanalytics.com/news-articles/confidence-levels-remain-high-consumers-unlikely-to-curtail-holiday-spendingThe Conference Board Consumer Confidence Index® decreased marginally in October, following a decline in September. The Index now stands at 125.9 (1985=100), down from 126.3 in September. The Present Situation Index – based on consumers’ assessment of current business and labor market conditions – increased from 170.6 to 172.3. The Expectations Index – based on consumers’ short-term outlook for income, business and labor market conditions – declined from 96.8 last month to 94.9 this month.

“Consumer confidence was relatively flat in October, following a decrease in September,” said Lynn Franco, Senior Director of Economic Indicators at The Conference Board. “The Present Situation Index improved, but Expectations weakened slightly as consumers expressed some concerns about business conditions and job prospects. However, confidence levels remain high and there are no indications that consumers will curtail their holiday spending.”

The monthly Consumer Confidence Survey®, based on a probability-design random sample, is conducted for The Conference Board by Nielsen, a leading global provider of information and analytics around what consumers buy and watch. The cutoff date for the preliminary results was October 18.

Consumers’ assessment of current conditions improved somewhat in October. Those claiming business conditions are “good” increased from 37.4 percent to 39.2 percent, while those saying business conditions are “bad” decreased from 12.2 percent to 11.2 percent. Consumers’ assessment of the job market was mixed. Those saying jobs are “plentiful” increased from 44.5 percent to 46.9 percent, while those claiming jobs are “hard to get” increased slightly from 11.0 percent to 11.8 percent.

Consumers were less optimistic about the short-term outlook in October. The percentage of consumers expecting business conditions will improve over the next six months decreased from 20.0 percent to 18.6 percent, while those expecting business conditions will worsen decreased from 13.3 percent to 11.6 percent.

Consumers’ outlook for the labor market was also less upbeat. The proportion expecting more jobs in the months ahead decreased from 17.6 percent to 16.9 percent, while those anticipating fewer jobs increased from 15.4 percent to 17.8 percent. Regarding their short-term income prospects, the percentage of consumers expecting an improvement increased from 19.7 percent to 21.1 percent, while the proportion expecting a decrease held steady at 6.5 percent.

Source: October 2019 Consumer Confidence Survey®

<![CDATA[Why Jump on the All-Inclusive Bandwagon?]]>Fri, 25 Oct 2019 00:13:23 GMThttp://tourismanalytics.com/news-articles/why-jump-on-the-all-inclusive-bandwagonBy Hector Medina, Senior Manager for New Market Development Apple Leisure Group
  • Leisure destinations in Mexico and the Caribbean show a robust hotel construction pipeline, with 62% and 42% of the rooms under construction poised to be part of all-inclusive properties, respectively.
  • Demand in these destinations continues to rise as tourism numbers and airlift continues to increase.
  • Customers choose the all-inclusive model because it provides value, as well as convenience.
  • Internationally recognized hotel brands commonly known for European Plan models have been turning to the all-inclusive model to grow their portfolios.
There’s no doubt about it—the all-inclusive (AI) resort is here to stay. The resort model that packages all room and board costs into one up-front rate has become a mainstay in beach destinations, most notably across Mexico and the Caribbean. The model is expanding, quickly, and there are no signs of development slowing down.

There are a variety of factors that contribute to the growth and success of the AI resort model, but the most important ones are the high profitability and returns for investors, developers, and owners, as well as the high popularity among consumers. In fact, many of the established brands that typically operate under the European Plan (EP) model (only room but no board) have been adopting the AI model into their existing and growing portfolios.

With a robust pipeline for hotel development across Mexico and the Caribbean over the next few years, there is ample opportunity for substantial ROI for investors and resort developers in the AI resort segment.

A Robust Mexico and Caribbean Pipeline
Leisure destinations in Mexico and the Caribbean are showing an impressive pipeline for growth over the next few years. According to a recent STR construction report, there was a 33.9% increase in the rooms under development across the region as of July, when compared to the previous year.

What this breaks down to is a total of approximately 21,405 total hotel rooms in the pipeline at different stages of development in leisure destinations in Mexico, most notably in Cancun, Riviera Maya, and Los Cabos. In the Caribbean there is a total of approximately 45,994 total hotel rooms in the development pipeline, the majority being in the Dominican Republic, Cuba, Puerto Rico, and Jamaica.

Of the total rooms in the Mexico development pipeline, 12,822 are currently under construction of which approximately 62% are estimated to be AI. Within the Caribbean development pipeline, 24,033 are currently under construction with approximately 42% are slated to be AI-focused.

Customers Choose AI
Why the rise in AI development? Among the many reasons, the model is highly appealing to the leisure traveler. In 2018 there were 30 million travelers that visited the Caribbean and 40 million people visited Mexico.

All of these travelers have a choice in the type and style of hotel they book. The AI model provides consumers with a worry-free option, and one that comes with built-in value.

“It’s all about the simplicity of the guest experience. An AI resort is the place where the consumer can check-in and then check-out worry-free.”

Not only this, today’s consumer is all about searching for value, and that’s true even in the luxury segment. According to the 2019 Caribbean Resort Product: Staying Ahead of Today’s Customer Preferences by Horwath HTL, “The last downturn changed the economic landscape, but it may have also altered the behavior of consumers who have learned to live without expensive products or see the value in them.” What this means for the hospitality industry is that consumers are searching for value-related offers and that fuels the growth of the AI sector.

The Industry Chooses AI
Not only are customers choosing AI resorts, brands that have long been known for their EP models have been adding all-inclusive models to their portfolios.

In a previous article I wrote for Global Hospitality Resources, “During the last 20 years the AI offering in the Caribbean, where the vast majority of the AI product in the Americas is concentrated, has not only grown, but more importantly, it has evolved through brand segmentation and product innovation, much like how the U.S. chain scales have done so in order to augment their outreach and appeal to multiple customer demographic clusters and income levels.”

“When I first published the article back in 2014, I noted the lack of U.S. brands entering the AI space, suggesting that U.S. brands would continue to shy away. But it seems that that my original assumption was wrong and it is changing, as major legacy brands are moving into the AI segment.”

Should there be Concern for Over-Saturation?
With so many hotel rooms in the pipeline, this begs the question, does the supply outweigh the demand? For some of the more popular leisure destinations in Mexico, such as Cancun, Riviera Maya, and Los Cabos, the amount of new development for 2019 will represent five to 11% of total supply. From a development standpoint and looking at key performance indicators retroactively, there might be a slight short-term concern for Cancun and Riviera Maya before the new rooms are absorbed into the market.

But, more importantly, much of the concern is focused on external factors which are out of any operator or brand’s control, such as sargassum or recent travel advisories that have affected connectivity. The dismantling of the international offices for the CPTM will also play a factor. For Los Cabos, there does not seem to be a concern of over saturation considering the demand has increased 21% during the last five years.

For the Caribbean, as of year-end 2018, of the 26 destinations that reported stay-over arrivals to the Caribbean Tourism Association, 17 reported growth, while only 9 reported declines.

“One must take into consideration that certain destinations are still ramping-up and normalizing after the 2017 hurricanes. More importantly, airlift into the region has continued to improve, which is a good sign for investment.”

How to Capitalize on the AI Market
Both Mexico and the Caribbean are two regions where Apple Leisure Group (ALG) operates a large percentage of its resort room portfolio. Via its Vacations brands, ALG sends approximately 2.3 million passengers to both regions annually, and the company’s vertical integration, which includes several distribution channels, ensures the resorts that work within the ALG umbrella operate with strong occupancy year-round.

The AI model has become a vital part of the hospitality industry in both Mexico and the Caribbean. It’s fueling nearly half of the development pipeline across both regions for the foreseeable future and continues to be a preferred option among consumers. Now is the time to align with the right partner to break into this competitive segment.

<![CDATA[Hawaii’s hotels saw average room occupancy grow by 0.9 percentage points in September to 78.2%.]]>Tue, 22 Oct 2019 20:09:13 GMThttp://tourismanalytics.com/news-articles/hawaiis-hotels-saw-average-room-occupancy-grow-by-09-percentage-points-in-september-to-782According to the Hawai‘i Hotel Performance Report, published by the Hawai‘i Tourism Authority (HTA), the month of September saw RevPAR grow by 4.4% to $193 statewide, with ADR growing by 3.2% to $247 and occupancy up by 0.9 percentage points to 78.2 percent.

The HTA’s Tourism Research Division issued the report’s findings utilizing data compiled by STR, Inc., which conducts the largest and most comprehensive survey of hotel properties in the Hawaiian Islands.

Hawai‘i hotel room revenues statewide increased 3.3 percent to $313.1 million in September. There were approximately 800 more occupied room nights (+0.1%) and nearly 18,000 fewer available room nights (-1.1%) compared to a year ago. Several hotel properties across the state were closed for renovation or had rooms out of service for renovation during September. However, the number of rooms out of service may be under-reported.

Luxury Class properties led in growth of RevPAR at $329 (+9.7%) in September, which was driven by increases in occupancy to 72.1 percent (+3.8 percentage points) and ADR to $456 (+3.9%). Midscale & Economy Class hotels reported RevPAR of $131 (+3.5%) with ADR at $164 (+1.4%) and occupancy of 79.8 percent (+1.6 percentage points).

In September, Maui County hotels reported the highest RevPAR of all four counties at $232 (+7.5%), which was supported by increases in both ADR to $319 (+4.9%) and occupancy of 72.7 percent (+1.7 percentage points). Maui’s luxury resort region of Wailea reported RevPAR of $380 (+4.4%), with ADR growth ($461, +7.5%) offsetting lower occupancy (82.4%, -2.4 percentage points).

O‘ahu hotels earned 2.4 percent RevPAR growth to $191, driven by higher ADR ($227, +2.4%) and no change in occupancy of 84.1 percent. Waikīkī hotels reported growth in RevPAR, ADR, and occupancy for September.

Hotels on the island of Hawai‘i saw increases in RevPAR to $150 (+20.9%), ADR to $222 (+8.6%), and occupancy to 67.5 percent (+6.8 percentage points) in September compared to a year ago. In May 2018, Kīlauea volcano started erupting in lower Puna, which contributed to a downturn in visitors to the island of Hawai‘i in succeeding months.

RevPAR for Kaua‘i hotels fell to $165 (-9.9%) in September, with declines in both ADR to $241 (-4.0%) and occupancy to 68.6 percent (-4.5 percentage points).

September Year to Date.
Through the first nine months of 2019, Hawai‘i hotels statewide reported RevPAR growing by 1.5% to $228, with ADR up by 1.9% to $281 although occupancy fell by 0.3 percentage points to 81.3 percent.

Year-to-date through September 2019, statewide hotel room revenues of $3.37 billion were similar to the same period in 2018.

There were nearly 230,000 fewer available room nights (-1.5%) and slightly more than 226,000 fewer occupied room nights (-1.9%) compared to a year ago. Several hotel properties across the state were closed for renovation or had rooms out of service for renovation during the first three quarters of 2019.

Luxury Class properties reported RevPAR of $433 (+3.2%), with ADR at $560 (+1.0%) and occupancy of 77.4 percent (+1.6 percentage points). Midscale & Economy Class hotels reported RevPAR of $144 (-2.6%), with ADR at $176 (-0.7%) and occupancy of 81.8 percent (-1.6 percentage points).

Hotel Results by County
Through the first nine months of 2019, Maui County hotels led Hawai‘i’s four island counties in RevPAR at $311 (+4.0%), with ADR at $397 (+2.6%) and occupancy of 78.4 percent (+1.1 percentage points).

O‘ahu hotels earned slightly higher RevPAR of $201 (+0.9%), with ADR at $238 (+1.2%) and occupancy of 84.5 percent (-0.3 percentage points).

Hotels on the island of Hawai‘i reported RevPAR growth to $204 (+3.7%), with increases in both ADR to $264 (+2.7%) and occupancy of 77.1 percent (+0.8 percentage points).

Kaua‘i hotels’ RevPAR decreased to $209 (-8.9%), with declines in both ADR to $284 (-1.8%) and occupancy of 73.6 percent (-5.7 percentage points).

Tables of hotel performance statistics, including data presented in the report are available for viewing online at: https://www.hawaiitourismauthority.org/research/infrastructure-research/

About the Hawai‘i Hotel Performance Report
The Hawai‘i Hotel Performance Report is produced using hotel survey data compiled by STR, Inc., the largest survey of its kind in Hawai‘i. The survey generally excludes properties with under 20 lodging units, such as small bed and breakfasts, youth hostels, single-family vacation rentals, cottages, individually rented vacation condominiums and sold timeshare units no longer available for hotel use. The data has been weighted both geographically and by class of property to compensate for any over and/or under representation of hotel survey participants by location and type.

For September 2019, the survey included 162 properties representing 48,212 rooms, or 89.3 percent of all lodging properties with 20 rooms or more in the Hawaiian Islands, including full service, limited service, and condominium hotels.

<![CDATA[An opportunity to advance Caribbean thinking about tourism.]]>Sat, 19 Oct 2019 20:20:32 GMThttp://tourismanalytics.com/news-articles/an-opportunity-to-advance-caribbean-thinking-about-tourismby David Jessop who is a consultant to the Caribbean Council
A few days ago, the Caribbean Tourism Organisation (CTO) announced that it is to restructure its operations in the face of rising costs and the need to “elevate tourism development in the region”.

It Chairman, the Minister of Tourism of St Lucia, Dominic Fedee, said that CTO would be closing its London and New York offices by the end of January 2020 and would undertake a comprehensive audit of the role of its head office in Barbados; a process that could well involve further redundancies.

Although one has to feel particularly sorry for its outstanding professional leadership and staff in London, the restructuring is expected to significantly reduce CTO’s operational expenditure, giving it greater capacity to focus on the functions that Minister Fedee and others involved have identified.

It is a change that is much needed.
It is no secret that CTO has struggled to ensure that its funding arrived on time, that some key governments preferred to limit their engagement to the areas where they felt the organisation added value, and that it has at times has been disinclined to engage in a constructive relationship with its private sector counterpart.

In an emailed statement, Mr Fedee said that in future the public sector institution which groups Caribbean tourism ministers and some corporate interests, would have to reinvent and reposition itself “as a pillar upon which tourism advancement can rest”. This he suggested would require CTO to refocus on marketing the Caribbean as a single brand, in-depth research, a more uniform approach to policy formulation and product development, and on tourism as a tool for sustainable development.

For complex historic reason CTO has a role that is unusual, mixing politics, policy development, functional objectives from statistics collection and analysis, to activities that cross over with those of the private sector.

It has previously done good work on marketing, made strenuous efforts in Washington lobbying Congress and multilateral institutions, succeeded in its activities in London on the UK’s Air Passenger Duty, engaged with the European Commission, and been involved in a positive way with many other initiatives including at times industry-critical dialogue with external commercial partners.

However, all institutions need to adapt and refocus.
CTO’s proposed restructuring offers the opportunity for Caribbean governments and the industry to consider what they want delivered by tourism’s various component entities and how at a policy level an effective, stronger, coordinated voice might be achieved on key issues.

Minister Fedee’s announcement comes at a time when the industry and consumer demand is changing and there is a growing understanding of the broader role the sector might play in Caribbean social and economic development. CTO’s restructuring also occurs just as international financial institutions and development partners such as the European Union are prepared to support responses involving sectoral initiatives.

While CTO is an institution of CARICOM and the Prime Minister of the Bahamas is the quasi Cabinet member for the sector, many find it inexplicable that Caribbean Heads appear to dedicate so little time to discussing the state of Caribbean tourism or its potential to drive growth and change. This suggests that there is much more to be done jointly by Tourism Ministers to move forward the sector’s priority policy concerns.

As CTO rationalises its core objectives, it has a unique opportunity to strengthen its role as the political voice of the industry that now dominates most Caribbean economies: one that creates on average 40% of the Caribbean’s GDP, earnt the region US$62bn in 2018, employs about one in eleven of the region’s citizens, and has the capacity to transfer to the region a significant part of the disposable income of travellers from more economically advanced nations.

As recent developments indicate, the industry is not short of problems that require joined up solutions whether they relate to the high cost of energy, security, airlift or sargassum.

Statistics suggest that despite the Caribbean continuing to experience buoyant visitor arrivals numbers, the industry in the region may not this year experience a commensurate overall rise in earnings and could begin to suffer if as some international financial institutions forecast, changing US trade policy results in a global economic slowdown.

According to the industry analysts STR (formerly known as Smith Travel Research) this year Caribbean hotels have experienced a decline in revenue per available room (RevPAR), a key industry measure of profitability, and a fall in occupancy rates, possibly signaling longer-term economic problems.

STR said that while hoteliers continued to increase the average daily rate (ADR) charged, this was not enough to drive RevPAR and thus profitability upwards. It forecast that 2019 will end with a 1.1% increase in ADR and a 0.3% rise in RevPAR over 2018, but a slight decrease in hotel occupancy of minus 0.8%.

This is the type of data which CTO needs to do more to develop and apply to regional tourism policy if weaknesses are to be addressed and tourism is to become a sustainable force for economic development.

A revitalised CTO could also support a serious debate about future growth: one that does not avoid difficult questions relating to longer term strategies on cruise tourism, aviation taxation, chain hotels, changing consumer requirements and who pays and benefits from the cost of marketing.

Well considered, change in in CTO could be a force for regional good, especially if its research and future actions encourage all Caribbean ministers and Prime Minister to respond more positively when tourism touches their portfolio.

Minister Fedee and his fellow tourism ministers will have done the region and its external partners a great service if a renewed CTO working closely with its private sector counterparts can share and deliver a new public a vision of tourism’s future role.

David Jessop is a consultant to the Caribbean Council and can be contacted at david.jessop@caribbean-council.org

<![CDATA[Thomas Cook departure shifts UK-Caribbean aviation dynamics]]>Fri, 04 Oct 2019 21:12:27 GMThttp://tourismanalytics.com/news-articles/thomas-cook-departure-shifts-uk-caribbean-aviation-dynamicsThomas Cook's 23-Sep-2019 entry into liquidation reduces to three (all based in the UK) the number of competitors operating scheduled airline services between the UK and the Caribbean.
A duopoly between British Airways and Virgin Atlantic until the airline subsidiaries of Europe's two biggest tour operator groups entered the scheduled market (Thomas Cook Airlines in 2013 and TUI Airways in 2014), UK-Caribbean then settled into a stable four way oligopoly.

Thomas Cook and TUI's entry stimulated growth for a couple of years, but overall seat numbers have grown at a compound average rate of only 1.7% pa since 2015.

Among the 24 routes operating in the winter high season week of 10-Feb-2020, there is competition only on the six biggest routes. Even on these competitive routes, there have been few significant capacity or frequency changes in recent years.

The Caribbean is the UK's biggest market by seats in Latin America, but its stable capacity compares with much faster growth to other markets in the region.

Thomas Cook was the smallest operator by capacity, with only around one eighth of annual seats. Its exit provides an opportunity for others to enter, but may just prompt the incumbents to close ranks around the space it leaves.

BA the biggest operator in a settled four-way market, which also included Virgin AtlanticTUI Airways and (until Sep-2019) Thomas Cook Airlines.

There has been little growth since TUI and Thomas Cook's entry into the scheduled market initially stimulated some expansion.

UK-Caribbean has a winter high season. There are 24 UK-Caribbean routes in the high season week of 10-Feb-2020, versus 18 in Sep-2019.

There is competition only on the six biggest routes and there have been few schedule changes in recent years.

Although it was the smallest operator in the market, Thomas Cook's departure will shift the competitive dynamics.

BA the biggest operator in settled four-way market
According to CAPA analysis of data from OAGBritish Airways is the biggest scheduled operator by annual seats between the UK and Caribbean in 2019.

Its seat share this year is 33.5%, ahead of Virgin Atlantic and TUI Airways, which both have an almost identical share (27.0% for Virgin and 26.9% for TUI). Thomas Cook Airlines has been the smallest - but still significant competitively - operator by seat share, with a 12.6% seat share in 2019 prior to its liquidation.

This fairly settled four-way market was a duopoly between BA and Virgin until the entry in 2014 of TUI, then operating as Thomson Airways, and Thomas Cook entered in 2013.

This was part of a strategic shift by the airline subsidiaries of the leading tour operators to embrace scheduled services, rather than purely offering charter capacity.

UK-Caribbean: weekly seat numbers by airline, Sep-2011 to Feb-2020
Source: CAPA - Centre for AviationOAG.

Little growth since TUI's and Thomas Cook's entry stimulated the market.

The data also indicate that annual scheduled seat numbers between the UK and the Caribbean will fall by 4.3% in 2019 compared with 2018. This follows no growth in 2018 (capacity was 0.4% below its 2017 level), although there had been growth of 4.9% in 2017 and 6.9% in 2016.

There has been no real dynamism in this market since 2015, the first full calendar year in which both TUI Airways and Thomas Cook Airlines were active participants.

The entry of the two leisure airline subsidiaries of Europe's leading tour operator groups stimulated a 66.1% increase in annual capacity between 2012 and 2015.

Almost four fifths of the incremental capacity over that three-year period was introduced by TUI and Thomas Cook, but their entry also stimulated growth by the incumbents. Between 2012 and 2015 BA's capacity increased by 12.8% and Virgin Atlantic's by 6.0%.

Since 2015, however, BA's capacity to the Caribbean is up by only 3.9% and Virgin's has been reduced by 6.8%. In 2019 only BA is growing – at just 1.9% – whereas Virgin, TUI and Thomas Cook are all reducing their annual seat count (the latter now exiting after ceasing all operations). Total annual seat count in 2019 is only 7.0% higher than in 2015.

UK-Caribbean has a winter high season
The UK-Caribbean market appeals to UK leisure travellers seeking winter sun. As a result, the schedule has peaks in the December-February period, while May-September is the low season.

Capacity to/from/within Europe as a whole tends to be skewed towards the summer schedule. For the combined winter 2018/2019 and summer 2019 seasons, the winter is only 37% of all European seats. This is less than the winter season's 41% share of weeks and demonstrates lower weekly seat capacity than in the summer.

However, for UK-Caribbean the winter is almost half (49%) of annual seats, which indicates higher weekly capacity than in the longer summer season.

Summer and winter seat share: UK-Caribbean and total Europe


Source: CAPA - Centre for AviationOAG.

Among the schedules of the four operators, BA's is the least seasonally skewed (44% of its UK-Caribbean seats are in the winter).

TUI's is the most skewed towards the winter (52% of its annual seats), while Virgin and Thomas Cook each have a 50:50 split between summer and winter.

There are 24 UK-Caribbean routes in the high season week of 10-Feb-2020

OAG data for the week of 9-Sep-2019, the lowest capacity week of the year, show that there are 18 UK-Caribbean routes this summer, although Thomas Cook's demise would seem to remove six of them. Three of these are summer-only (Birmingham-Punta CanaGatwick-Cayo Coco and Gatwick-Aruba), while one (Gatwick-Holguín) is to be withdrawn by the sole operator Thomas Cook Airlines in Oct-2019.

There will be 24 routes operated in the high season week of 10-Feb-2020 (see table below), following the resumption of ten winter-only routes.

Note that four of these winter-only routes are operated by TUI Airways for only a week at a time, typically with one frequency, during a handful of weeks over the winter. There are also eight other such routes not operating in the week of 10-Feb-2020 (but those are flown during other winter weeks).

These routes, which TUI rotates through the winter for a week at a time, are to Bridgetown from NewcastleGlasgowStanstedBournemouth, E. Midlands, Doncaster SheffieldBristolCardiff and Belfast International; and to Montego Bay from CardiffNewcastle and Glasgow.

UK-Caribbean: routes operated, week of 10-Feb-2020
RankOriginDestinationDeparting FrequencySeatsOperators on airport pair
     (ranked by seats) 
1London GatwickBridgetown Grantley Adams2816,926BA, Virgin, TUI, Thos Cook*
2London GatwickSaint Lucia Hewanorra136,868BA, Virgin, TUI
3ManchesterBridgetown Grantley Adams96,354TUI, Thos Cook*, Virgin
4London GatwickAntigua VC Bird115,754BA, Virgin
5London GatwickMontego Bay Sangster64,782Virgin, TUI
6London GatwickPunta Cana63,452BA, TUI
7BirminghamBridgetown Grantley Adams42,652TUI
8ManchesterMontego Bay Sangster32,361TUI
9London HeathrowNassau Lynden Pindling42,072BA
10London GatwickKingston Norman Manley31,554BA
11ManchesterPunta Cana21,272TUI
12London GatwickHavana Jose Marti21,064Virgin
13BirminghamMontego Bay Sangster1690TUI
14ManchesterCayo Coco1686Thos Cook*
15ManchesterVaradero Juan Gualberto Gomez1686Thos Cook*
16ManchesterHolguín Frank Pais1686Thos Cook*
17London HeathrowBridgetown Grantley Adams1530Virgin
18CardiffBridgetown Grantley Adams1345TUI
19ManchesterAntigua VC Bird1343Thos Cook*
20ManchesterSaint Lucia Hewanorra1343Thos Cook*
21ManchesterTobago ANR Robinson1343Thos Cook*
22BristolBridgetown Grantley Adams1291TUI
23CardiffMontego Bay Sangster1291TUI
24Belfast Int'lBridgetown Grantley Adams1291TUI
*Thomas Cook Airlines and its parent Thomas Cook Group went into liquidation on 23-Sep-2109
Source: CAPA - Centre for AviationOAG

Manchester Airport has the most routes; Gatwick has five of the six biggest routes
During the week of 10-Feb-2020 Manchester will have nine of the 24 routes, more than any other airport. Gatwick will have seven, matched by Bridgetown on the Caribbean side of the market. Heathrow, the UK's biggest airport, has only two routes to the Caribbean (Nassau and Bridgetown).

Five of the six biggest routes by weekly seat capacity will be from Gatwick.
Competition only on the six biggest Caribbean routes. The six biggest routes in the week of 10-Feb-2020 are all competitive, but there has been little change to each operator's schedule on these routes in recent years.

Gatwick-Bridgetown, the biggest route by seats, is operated by BA, Virgin, TUI and was due to be operated by Thomas CookBA and Virgin operate year-round, whereas the two tour operator airlines have operated only in the winter (TUI since 2014/2015 and Thomas Cook since 2015/2016).

The next two biggest routes are operated by three of the four: Gatwick-Saint Lucia by BA, Virgin and TUI; Manchester-Bridgetown by BA and Virgin (Thomas Cook had also been scheduled on this route).

BA and Virgin have a duopoly on Gatwick-Antigua (where BA is bigger), while Virgin and TUI have a duopoly on Gatwick-Montego Bay (where Virgin is bigger). BA and TUI have a duopoly on Gatwick-Punta Cana.

The remaining 18 routes listed by OAG for the week of 10-Feb-2020 each have only one operator. TUI has eight monopolies, while Virgin and BA have two each. Thomas Cook's six monopoly routes will presumably disappear, at least in the short term.

However, one of Virgin's monopoly routes is Heathrow-Bridgetown, which faces city pair competition from Gatwick-Bridgetown, operated by all four airlines in the UK-Caribbean market.

In total, TUI has 13 routes, Virgin has seven and BA has six routes in the week of 20-Feb-2020. Thomas Cook would have had eight routes. In this high season week, TUI's greater seasonal bias gives it 30.1% of UK-Caribbean seats, almost the same as BA's 31.6%, while Virgin has 24.7% (all seat shares are based on including the 13.6% share planned for Thomas Cook prior to its liquidation - without it, the share of the other three will increase proportionately, assuming no other operator takes on its routes).

Only minor schedule changes are planned for UK-Caribbean
There are no current plans for major changes to UK-Caribbean schedules, although some minor changes are planned.

On Gatwick-Saint LuciaBA plans to increase frequency from seven to nine times weekly in Jun-2020, while Virgin plans to suspend its three times weekly service next summer.

Virgin's Gatwick-St Lucia-Grenada service will be rerouted as Gatwick-Antigua-Grenada in summer 2020. At the same time, Virgin will reduce its Gatwick-Antigua service from three times to once weekly, but overall service to Antigua will increase to four times weekly with the rerouting.

Virgin Atlantic plans to transfer its twice weekly Gatwick-Havana service to Heathrow next summer.

Following Thomas Cook's exit, Virgin has raised its weekly frequency on Manchester-Bridgetown from two to three and on Gatwick-Bridgetown from seven to nine for winter 2019/2020.

BA is to increase Gatwick-Punta Cana from three to four times weekly between 21-Dec-2019 to 28-Mar-2020.

As Thomas Cook leaves, UK-Caribbean could be ripe for new entrants.
The stable market structure undergoes the occasional tweak, but there had been no fundamental change since the entry of TUI and Thomas Cook into scheduled UK-Caribbean services. This historically leisure focused market was built on historic ties between the UK and the Caribbean and also features a significant VFR segment.

The stagnation of scheduled capacity growth on UK-Caribbean routes contrasts with a tripling of UK-Lower South America capacity and an approximately 20% increase in UK-Upper South America capacity over the past two years.

The lack of growth or any significant change in competitive dynamics suggests that the UK-Caribbean aviation market could be ripe for disruption by one or more new entrants.

Thomas Cook's exit could provide the catalyst.

Equally, the structure of this market has limited its competitive dynamics over the years and the remaining three operator may work to maintain the new status quo, as suggested by the early signs. 

<![CDATA[FLIGHT PASSENGER GROWTH COULD HALVE DUE TO ‘FLIGHT SHAME’, SAYS NEW RESEARCH]]>Wed, 02 Oct 2019 19:49:06 GMThttp://tourismanalytics.com/news-articles/flight-passenger-growth-could-halve-due-to-flight-shame-says-new-researchMore than a fifth of people say they have reduced number of flights they take.

The expected growth in air travel passenger numbers could halve due to climate change fears, according to new research.

Swiss bank UBS surveyed more than 6,000 people from the UK, US, Germany and France about their flying habits, and found the rise of “flight shame” or flygskam seems to be spreading.

More than a fifth (21 per cent) of those surveyed said had they had intentionally reduced the number of flights they took over the last year.

While just 16 per cent of British travellers claimed to be cutting back, 24 per cent of Americans said climate change had convinced them to reduce the number of flights they took.

According to UBS, there has been a marked increase in the number of people purporting to be curbing their flying habit since the survey was first conducted in May 2019.

Part of this could be due to the flight shame movement, which started in Sweden but has since gained traction further afield thanks to high profile examples, such as teenage activist Greta Thunberg’s recent trip to the US by yacht.

Attention-grabbing protests from climate change activism group Extinction Rebellion, which has targeted the aviation industry in the past, have also raised awareness of the issue this year.

The number of air travel passengers has been rising at a rate of 4-5 per cent a year – a statistic the two biggest planemakers, Airbus and Boeing, use to calculate future passenger growth. 

Both have predicted passenger numbers will roughly double by 2035.

However, based on current trends, UBS estimates EU flight numbers will increase by just 1.5 per cent – half the number expected by Airbus – with US growth forecast at 1.3 per cent, rather than the planemaker’s prediction of 2.1 per cent.

If UBS’s forecasts are correct, it could result in aircraft orders dropping by 110 per year.

It comes as even airlines are committing to tackle climate change; this summer, Dutch carrier KLM encouraged passengers to “fly responsibly” and announced it was launching train services as an alternative to its Amsterdam-Brussels route.

<![CDATA[Hawaii’s hotels report average room occupancy grew by 5.5 percentage points in August to reach 84.3%.]]>Thu, 19 Sep 2019 18:38:08 GMThttp://tourismanalytics.com/news-articles/hawaiis-hotels-report-average-room-occupancy-grew-by-55-percentage-points-in-august-to-reach-843According to the Hawai‘i Hotel Performance Report published by the Hawai‘i Tourism Authority (HTA), statewide RevPar increased in August to $244.27 (+ 10.7%), with ADR increasing to $289.75 (+3.4%) and occupancy growing by 5.5 percentage points.

Through the first eight months of 2019 Hawaii’s hotels reported an average room occupancy of 81.7%, down 0.4 percentage points from 82.1% in 2018, with an ADR of $284.74, up 1.8% from 2018, and a RevPar of $232.57 up 1.2% compared with the same eight months of 2018.

HTA’s Tourism Research Division issued the report’s findings utilizing data compiled by STR, Inc., which conducts the largest and most comprehensive survey of hotel properties in the Hawaiian Islands.

In August, Hawai‘i hotel room revenues statewide grew by 8.6 percent to $408.7 million, which is $32.5 million higher than last year. Room demand was up 5.0 percent to 1.4 million room nights, with supply down 1.8 percent compared to a year ago.  Several hotel properties across the state were closed for renovation or had rooms out of service for renovation during August.

Tables of hotel performance statistics, including data presented in the report are available for viewing online at: https://www.hawaiitourismauthority.org/research/infrastructure-research/

All classes of Hawai‘i hotel properties statewide reported RevPAR gains in August. Luxury Class properties reported a strong increase in RevPAR to $469 (+13.0%), driven by an increase in occupancy to 81.9 percent (+8.9 percentage points) and ADR similar to a year ago. Midscale & Economy Class hotels reported RevPAR of $146 (+8.8%), with ADR of $176 (+2.6%) and occupancy of 82.5 percent (+4.7 percentage points).

Among Hawai‘i’s four island counties, Maui County hotels led the state in RevPAR at $306 (+12.7%), with ADR of $389 (+3.5%) and occupancy of 78.6 percent (+6.5 percentage points) in August. Maui County was led by the strong performance of properties in Wailea, which earned RevPAR of $542 (+9.3%), ADR of $608 (+4.4%) and occupancy of 89.2 percent (+4.0 percentage points).

O‘ahu hotels reported RevPAR growth to $227 (+6.5%) in August, with increases in ADR to $255 (+1.5%) and occupancy of 88.8 percent (+4.2 percentage points). Waikīkī hotels saw RevPAR, ADR and occupancy increases in August.

Hotels on the island of Hawai‘i saw significant increases in RevPAR to $227 (+35.6%), ADR of $281 (+15.8%) and occupancy at 80.9 percent (+11.8 percentage points) in August compared to the same time last year. Kohala Coast hotels earned a 54.5 percent increase in RevPAR to $342, with ADR of $406 (+16.1%) and occupancy of 84.3 percent (+21.0 percentage points). In May 2018, Kīlauea volcano started erupting in lower Puna, which contributed to a downturn in visitors to the island of Hawai‘i in the following months.

Kaua‘i hotels reported flat RevPAR of $213 (+0.2%) in August, with higher occupancy (74.4%, +1.9 percentage points) offsetting a decrease in ADR to $286 (-2.3%).

About the Hawai‘i Hotel Performance Report
The Hawai‘i Hotel Performance Report is produced using hotel survey data compiled by STR, Inc., the largest survey of its kind in Hawai‘i. The survey generally excludes properties with under 20 lodging units, such as small bed and breakfasts, youth hostels, single-family vacation rentals, cottages, individually rented vacation condominiums and sold timeshare units no longer available for hotel use.

The data has been weighted both geographically and by class of property to compensate for any over and/or under representation of hotel survey participants by location and type.

For August 2019, the survey included 162 properties representing 48,292 rooms, or 89.5 percent of all lodging properties with 20 rooms or more in the Hawaiian Islands, including full service, limited service, and condominium hotels.
Properties report rooms as officially out of service to STR if they are unavailable for rent for 30 days or more. However, it should be noted that rooms out of service for renovation for less than 30 days are still included in the supply numbers.  
<![CDATA[New way to count number of tourist arrivals?]]>Sun, 15 Sep 2019 14:43:55 GMThttp://tourismanalytics.com/news-articles/new-way-to-count-number-of-tourist-arrivalsScientists used millions of travelers' Flickr photos to quickly calculate global tourism. Is analyzing online data the next step in measuring our society?
Our summer vacation photos are a record of happy memories made with friends and families, proof of where we’ve been and what we’ve done during our precious time off. Thanks to team of scientists at the Data Science Lab at Warwick Business School and The Alan Turing Institute, these photos might prove to be more than just happy memories, but also serve as rapid, low-cost insights into how people travel around the globe.
New research from Professor Tobias Preis, Dr. Federico Botta, and Professor Suzy Moat analyzed data from 69 million publicly shared photos uploaded to the platform Flickr to estimate global tourism statistics for the G7 countries: Canada, France, Germany, Italy, Japan, the UK and the US.

This map depicts the locations in which 35 million photographs were taken and uploaded to the photo-sharing platform Flickr in 2014.

While countries often rely on potentially time-consuming surveys at airports and accommodation to determine where their visitors are from, the new findings show that rapidly available, low-cost data from photos uploaded to the internet might be able to provide similar measurements.

Tobias Preis, Professor of Behavioral Science and Finance and co-director of the Data Science Lab at Warwick Business School
“We analyzed data on where and when 69 million Flickr photos had been taken over a period of two years,” explained Preis. “To work out where visitors to the UK were from, we identified photos that had been taken in the UK, and then looked at where the photographer had taken photos over the past 12 months.

“We had to make a big simplifying assumption about where people were between photos: namely, that they’d stayed in the same country since the last photo,” he continued. “However, even with this big simplification, we found that estimates of the number of travelers from different countries generated from the online photo data were correlated with the official tourism statistics. The same holds for the other G7 countries.”

The G7 countries currently use various methods to calculate tourist numbers, including collecting data at airports, hotels, and other tourist accommodations. However, common to all these methods is a publication delay, which ranges from months to years.

Suzy Moat, Professor of Behavioral Science and co-director of the Data Science Lab at Warwick Business School

Instead, using the almost instant availability of online data might provide far quicker estimates of tourist flows between countries. By analyzing 69.2 million photos uploaded to Flickr in 2013 and 2014 the researchers were able to infer the travel patterns of nearly half a million people.

When compared to official data released by the G7 the researchers found a strong correlation between the photo-based estimates and the official estimates. They caution, however, that considerable further work will be needed before such insights can be used in the production of official statistics.
“Policymakers need quick, accurate information to make good decisions, especially in times of great change,” said Moat. “Traditional approaches to measuring the state of our society can be time-consuming as well as expensive, and so the possibility of generating rapid, low-cost indicators from online data is very exciting.

Federico Botta, Research Fellow in the Data Science Lab at Warwick Business School

“However, a robust framework would be needed to utilize these insights in practice, to deal with challenges such as bias in the online data, whether access to the online data could be relied upon, and how to calculate and communicate how certain we can be about the estimates we make.”

<![CDATA[Reassessing the Role Of Cruise Tourism]]>Sun, 15 Sep 2019 14:34:44 GMThttp://tourismanalytics.com/news-articles/reassessing-the-role-of-cruise-tourismDavid Jessop – Caribbean Council.
Cruise tourism has become a big business, with the Caribbean now accounting for more than 35 per cent of all such vacations globally.

This year more ships will sail in or through Caribbean waters than in any other part of the world, with many of the one hundred plus new vessels under construction destined to do the same.

Despite this, no government or industry body has yet been able to focus with any success on how little the cruise lines contribute to Caribbean development, government revenues, or the local economy. Nor have they found ways that equitably relate cruise tourism to the now regional economic importance of the hotel sector, the ancillary onshore demand that long-stay visitors create, or the higher taxes they pay.

Statistics produced by the Caribbean Tourism Organisation, CTO, show that there were 29.2 million cruise ship visitor arrivals into the Caribbean in 2018, a figure roughly equal to the 30.2 million long stay visitors who came by air to stay in hotels and other onshore facilities.

However, these figures are misleading. Cruise ship passengers almost all stayed for only a small part of a day and visited multiple countries, raising questions about double counting. In contrast, visitors who arrived by air stayed on average for seven nights in a single location, contributing, according to CTO, 11.5 times more than cruise passengers to the local economy and to government revenues.

Unfortunately, there seems to be little in the way of consistent or reliable recent reporting as to exactly how much either category of visitor left behind of what they spent.

Figures produced by the cruise industry, governments and tourist boards provide some indication of gross spending, but, for not well explained reasons, vary significantly from country to country and are not up to date.

Reports relating to 2015 indicate that cruise visitors to the United States Virgin Islands spent between US$138 and US$158 while the average visitor arriving there by air spent between US$200 to US$250 each day of their stay. However, figures for cruising to other destinations for the same year are much lower, with, for example, such visitors to The Bahamas recorded as spending US$$83 and to Barbados US$78.

Help is however at hand to better understand the broader impact of cruise tourism and the issues that governments and the region’s tourism industry after a long period of silence ought to revisit.

In June, the Washington-based Center for Responsible Travel, CREST, published a detailed and balanced study: ‘Cruise Tourism in the Caribbean: Selling Sunshine’.

Edited by the organisation’s outgoing executive director, Dr Martha Honey, it sets out for industry professionals the ways in which governments, tourist boards, citizens and the industry might change the nature of their future discourse with the cruise lines.

Apart from containing a contemporary analysis of cruise tourism, its environmental and social impacts, and the effects of climate change and overtourism, its 180 pages outline the reforms needed if cruise tourism is to bring greater benefit to the region.

Although some of the solutions it proposes will undoubtedly prove controversial with the cruise industry, the publication identifies many practical ways to resolve the problems they have created.

It offers ideas as to how to address the issue of the low head taxes that the cruise lines presently pay to government, suggests the need to incentivise home porting, indicates the important lessons to be learned from the negative experiences of Venice and Barcelona, discusses length of stay, and points to the positive models elsewhere the region might emulate.

But more importantly, ‘Selling Sunshine’ suggests the need for a cruise industry that is genuinely Caribbean-focused rather than one that exist solely to benefit the owners of the big cruise companies. As such its narrative and recommendations require serious consideration by any Caribbean politician who genuinely has at heart the need for national and social development.

The study follows an earlier interesting commentary by Robert C, the managing director of MacLellan & Associates, a Caribbean-based hospitality consultancy.

He suggests that to have the normally intransigent cruise companies bring greater benefit, Caribbean governments should learn from the Organisation of Petroleum Exporting Countries, OPEC, and establish an Organisation of Tourism Economy Countries.

MacLellan argues that the weak negotiating position of individual Caribbean and Central American governments has many similarities to OPEC member states sixty years ago, and that a ‘rebalancing’ strategy should now be pursued by the Caribbean when it comes to the cruise lines. In this way, he suggests, not only could the issue of head taxes be addressed, but other issues of benefit to the region might be considered. Recent conferences on tourism held in Jamaica and Washington demonstrate that there is a growing appetite and anger among Caribbean participants for change. They say that what is required is a more equitable basis on which cruise ships operate in the region.

Frank Comito, executive director of the Caribbean Hotel and Tourism Association, believes that there is plenty of room for both the land and sea-based industry but what is required is for cruise lines’ involvement to be more balanced.

He observes that while the cruise lines have been a good corporate partner in times of crisis, supporting the immediate relief and recovery of destinations affected by hurricanes, many in the industry believe that they should be doing far more to protect and enhance the environment, develop the tourism product, support local businesses, and grow the Caribbean’s tax base.

He says that hotels and other local tourism partners bear the brunt of the tax burden on the tourism industry, contributing heavily to destination-improvement initiatives and local social causes, helping to market their destinations, and helping to enhance and protect the environment.

What is needed, he says, is a resolve by all stakeholders to work together on these and for the cruise industry to become a more engaged, conscientious partner.

Cruise ships have a potentially important socio-economic and environmental stewardship role to play in the Caribbean, but their contribution has to be about much more than helping in times of crisis or, for example, building piers or offering a handful of jobs and scholarships, and being able to sail away at will.

As Honey, MacLellan and Comito suggest, it is time to explore how the cruise lines can be encouraged to put much more back and play a genuinely sustainable developmental role in return for the value they derive from the Caribbean and their use of the region’s exclusive economic maritime zone.