International visitors hit new record; TNQ sees good growth

The much-delayed Tourism Research Australia International Visitor Survey for the Dec 2014 quarter has finally been released (and is available for download here). This report has been delayed by the problems the ABS have been having with their Overseas Arrivals and Departures data.

What the report shows us is that international visitors into Australia were up 7.7% in the quarter from the same period a year ago to a record 6.357 million. Regional expenditure (i.e. ignoring costs of flights and packages paid for abroad) rose by 5.1% to $20.392 billion while the average regional expenditure per visitor fell by 2.4% to $3,208. As always, these dollar amounts are in nominal terms so we need to account for inflation over the period (about 1.7%) to get a real number.

In Queensland the total visitor number rose by a rather less impressive 5.6% to 2.148 million (best result for the state since 2008). Regional expenditure was up 4.1% to $4.15 billion while the average expenditure per visitor fell 1.4% to $1,933. As the chart below demonstrates, QLD’s share of the international market has been in significant decline for some time and this data does nothing to reverse that situation. A year ago QLD accounted for 34.5% of all international visitors, today that has fallen to 33.8% (it was as high as 43% eight years ago!). Much of that decline in QLD’s share can be slated to the dramatic weakness in the Tropical North Queensland market over those years.

In TNQ we see total visitor numbers up 7.9% over the year to 739,000 (the best result in 6 years) with average regional expenditure per visitor up 2.2% (which is a much better result that at either national or state level). These are good numbers for the region and come largely on the back of the well documented surge in Chinese visitors (which were up 10% to 156,600). However, we should also note a very solid performance from the US market; visitor numbers from the States were up 12.3% from a year ago to 86,500. Unfortunately the traditional markets of Japan and the UK both fell over the year; Japan down 1.4% to 86,500 and the UK down 1.1% to 87,900. What the second chart below makes very clear is that the recovery in TNQ visitor numbers since 2011 has largely been down to the Chinese (of the 152,000 increase in visitor numbers since Dec 2011, Chinese growth has accounted for more than 55%, with the US market adding another 11%).

Whilst these are encouraging numbers for TNQ they do nothing to address the slide in the share of the international market the region is attracting. TNQ’s share of the international market now stands at 11.6% (unchanged from last year) which is down from about 17% eight years ago. That may not sound like a lot but, had TNQ held on to that share of the market, we would now be talking about a total of some 1.08 million international visitors to the region; a 46% increase on where we are now. As we have been saying for a long time now; the industry and TTNQ need to take a long hard look at why they have performed relatively so poorly for so long.
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