Domestic tourism continues to dive in TNQ

Tourism Research Australia’s National Visitor Survey for the December quarter (available here) does not make happy reading for the industry in the Far North. While total overnight domestic visitors in Australia rose by 4.2% from the previous year, and were up by 3.4% in Queensland, the TNQ region saw a decline of 11.3%. Overnight domestic visitors to the region fell to 1.9 million for the year to end Dec 2016 from 2.14 million the previous year.

Last quarter we posed the question “is the domestic tourism boom in the Far North coming to an end?” (see here) and concluded that it was probably too early to say. We wanted to see more data. Well, that data’s now in and it doesn’t look good.

Expenditure from domestic overnight visitors to TNQ has fallen by 15.5% from the previous year; this equates to almost $400 million less being spent in the region. Day visits have never played a large part in the TNQ story, but here too we see weakness (down 0.4%) in the face of stronger national and Queensland numbers (both up about 5.5%). Combining both overnight and day visits we see expenditure in TNQ down by 14.4% over the year.

As the chart below makes clear, the solid growth in international visitors (which continues unabated…see here from a fortnight ago) is not enough to make up for the large decline in the (much larger) domestic market. Total visitor expenditure in the region for the 2016 year fell 7.5% from 2015.

The reasons for such a decline over the past three quarters is not yet clear, but anecdotal evidence suggests that the heavily negative media regarding the bleaching event on the northern GBR last year (unfortunately being repeated again this year in the tourist hot-spots further south) may be deterring Aussies from making the trip to the north. Clearly TTNQ, and its soon-to-be-appointed new CEO, will be keen to reverse this worrying slide.

UPDATE. TTNQ have cast doubt on the data (see here) and TRA accept that the data from 2014 and 2015 could have over-stated the position for TNQ. If that is the case then the stellar results in past quarters (that TTNQ were happy to agree with) could have been an illusion…we shall have to see what TRA decide once they’ve completed their work on the data. Good coverage on this issue fro Mark Beath at Cairns Economy…see here.

China helps TNQ beat the international visitor pack

The Tourism Research Australia International Visitor Survey for the quarter to Dec 2016 (available here) shows international visitor numbers continuing to improve; although visitors are staying for less time.

Total visitors for the year hit a new record high of 7.625 million; an increase of 11.2% from the previous year. Expenditures rose by 8.1% to $26.2 bn which saw the average expenditure per night fall by 2.8% while the average length of stay dropped by 8.5%.

Queensland fared not quite as well with total visitors up 10.1%, expenditure up 4.0% and average expenditure per visit falling by 5.6%.

Tropical North Queensland, lead by the surge in Chinese visitors, was a stand-out performer. Total visitor numbers were up 15.4% to 901,000. Despite expenditure rising strongly (up 10.2% to $1.12 bn) the average spend per visit fell 4.5%. As a result TNQ’s share of the international visitor market has started to climb back from the lows seen in 2012, although there’s still a very long way to go to return to the heady days of a decade ago when 17% of all international visitors were coming to the Far North.

But make no mistake, the solid TNQ performance isn’t all down to China. While China saw a huge 32.1% gain in total visitors to the region (to 229,000) Japan also experienced very good growth (up 21.2%) , as did the US (up 14.6%). As we can see from the chart below, the US and Japan have now pulled well clear of the pack behind China.

The tourism picture for 2016 will be completed in a fortnight’s time when we see TRA’s National Visitor Survey released.

 

Has the TNQ domestic tourism boom come to an end?

Today saw the release of Tourism Australia’s National Visitor Survey for the Sept quarter (available for download here). It shows domestic tourism growing at almost 5% nationally but QLD, and TNQ in particular, not performing as well.

Nation-wide domestic overnight visitors increased by 4.8% on the year to Sept to exceed 89 million. In QLD the increase, to 20 million, was just 1.6%. In our own region we saw overnight domestic visitor numbers to TNQ actually decline by 7.3% over the year to less than 1.9 million. When we consider just holiday visitors the decline is even greater at -12.4%. This takes the region’s share of the domestic market back to 2.1%, having hit recent record highs of almost 2.5% just 6 months ago. Total domestic expenditure in the Tropical North fell by 3.4% (to $2 billion) as the average spent per visitor increased by more than double the rate of inflation, 4.1%.

In answer to the question posed in the post title, I think it’s probably too early to suggest the boom is over. As we can see from the chart below domestic tourism expenditure in the region remains well above the levels seen just a few years ago. Nevertheless, it is also clear that we have come well off the peaks seen earlier this year. A few more quarters of data should confirm one way or the other but I would certainly want to see TTNQ making some moves to address the significant decline in the TNQ domestic market which has come as total domestic tourism numbers nation-wide hit new record highs.

International Visitors Survey is more good news for TNQ

Tourism continues to be a bright star in the economic firmament of Queensland, and TNQ in particular.
International visitors to the state were up 13.1% for the year to Sept 2016; better than the national average of 11.5%. Even better, the growth into the Tropical North Queensland region was higher still at 16%. This takes us to a new high for the region and we now sit 1.3% above the previous high seen in June 2006. When combined with booming domestic tourism numbers we are seeing the industry having its best spell for many years.

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Domestic tourism is by far and away the more important for the region bringing in 2 million visitors compared to 876,000 from overseas (domestic data is up to June 2016; the Sept 2016 data is due for release in a fortnight). Domestic tourists spend some $2.3 billion in the region while the international visitors spend just over $1.1 billion.
Even more dramatic is the rate of growth in the domestic sector. Visitor numbers are up 13.6% for the year with expenditure up 24%. Domestic visitor numbers to the region are now close to record highs after a slight dip from the March quarter.
International growth has been solid (visitors up 16% with expenditure increasing 11.7%) which when combined with the domestic sector is seeing the region’s tourism industry having its best spell for many years.
Within the international market Chinese visitors continue to grow very strongly. Visitors from China now account for a record high of 14.7% of all international visitors to the country, and an even higher 25% of all visitors to TNQ.
Chinese visitor numbers to TNQ grew by over 32% for the year to Sept. But the growth hasn’t been limited to China. We’ve also seen solid growth from the more “traditional” markets of the US (up 23.6%) and Japan (up 27.8%). Clearly this growth from Japan is very welcome but, as the chart below makes clear, numbers remain well below those we saw in the heydays of 2004 and 2005.
Indeed it’s worth noting that despite the exponential growth in visitations from China they are yet to reach the heights we saw from Japan over a decade ago.

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A decade ago another significant market for the region was the UK. Unfortunately we have seen very little recovery from that market since the gradual declines seen from the GFC through to 2012 (up just 1.9% this year). Back in 2003 the UK accounted for over 14% Australia’s visitors; today that has fallen to 9%.
While the domestic sector has reached new highs in terms of visitor numbers and share of the market, the international sector is only slowly making up lost ground when we consider its share of the total international visitor market in Australia.
A decade ago over 17% of all international visitors were coming to TNQ; today that rate is still below 12% (although it has recovered from lows close to 11%). To put that loss of market share into some context; had TNQ maintained a 17% share of the total Australian international market our international visitor numbers for the year to Sept 2016 would have been over 1.2 million instead of the actual 876,000. These are enormous differences and give us some idea of how much more can be done to improve the region’s performance in the international market.
If the domestic market gains continue, and we can be more successful tapping into the growth in the international sector (in particular into some of the non-Chinese markets) then the future for the industry in the region looks rosy indeed.

Domestic tourism boom really benefiting TNQ

The impact that the domestic tourism boom is having in Tropical North Queensland can be clearly seen below. The expenditure figures include both overnight and day trips.  Domestic tourism has added more than $500 million extra this year over last; that’s an increase of more than 24% y/y.

International tourism expenditure is also up by $100 million for the year; that’s a 13% increase.

While the China boom is obviously have a huge impact in Cairns, the region as a whole is actually benefiting more from the surge in domestic tourism numbers.

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More stellar Domestic Visitor data for the Far North

Tourism Research Australia’s National Visitor Survey results for the year to June 2016 (available here) confirm the wonderful run of data we’ve been seeing in the Far North. Combined with the solid International Visitor Survey data released a fortnight ago (see here) today’s data confirms a fabulous financial year for the tourism sector in general, and in the Far North in particular.

Total overnight domestic visits across the country were up 6.8% y/y to 88.9 million for the year to June 2016. Expenditure rose by 6.4% to $59 billion.

The results were not quite so strong for Queensland where visits were up just 5.7%. As a result the states share of the total domestic market fell to 22.7% which is close to a record low (see the second chart below). However, on the positive side, expenditure in Queensland was up 7% and accounted for 24.8% of all domestic expenditures.

After the phenomenal results of the previous quarter (which saw domestic visitor numbers up by more than a third on the year) TNQ has managed another excellent quarter. Visitor numbers to the region were up to 2 million (or plus 13.6%) with expenditures rising a thumping 24.1% to $2.3 billion. This sees average expenditure per visitor rise by 9.2% to $1,115. With inflation running at just 1-1.5% levels for the year these are excellent results.

With the A$ remaining fairly weak, and potentially set for further declines as US interest rates continue to rise (albeit very slowly), we can expect to see the tourism sector enjoying good results in coming quarters. Indeed data so far available for July (see here) shows international arrivals numbers growing at an ever faster pace, and departures increasing at less than half that rate.

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Short Term Arrivals growth accelerates

The good news for the tourism industry continues. The ABS Short Term Arrivals and Departures data for July shows arrivals up 14% y/y (the best result since May ’14) and up 10.3% annually (the sum of the past 12 months) which is the best result for more than eleven years. Short term arrivals over the past 12 months now exceed 7.9 million; also a new record.

As we are all aware much of this growth has come from the Chinese market. Arrivals in July were up 23.5% from a year ago while total arrivals over the past 12 months increased by 24.1%. Over the course of the past year arrivals from China accounted for 14.8% of all arrivals into the country (another new record).

But it’s not all been China. Arrivals from the US over the past year are up 14.6% while the Japanese market has also seen good recovery, up 18.2% over the course of the past 12 months.

Departures are also growing, although at a much slower pace. Departures in July were 6.6% higher than a year ago while over the course of the past year departures are up just 4.6% and now sit a just over 9.7 million.

The increases being seen in both the Chinese and Japanese markets certainly bode well for the International Visitor data for the TNQ region for the third quarter (due for release at the end of November). Domestic Visitor data for the June quarter will be released by Tourism Research Australia next Wednesday.

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International Visitor Survey is good news for QLD and TNQ

Today’s International Visitor Survey from Tourism Research Australia for the June 2016 quarter (available here) provides some good news for Queensland, and particularly the Tropical North.

International visitors to Australia were up 10.3% for the year to almost 7.25 million. expenditure lifted 14.6% with the average expenditure per visitor up by 3.9%.1608312

The numbers for Queensland were better still with visitors growing 11.3% to almost 2.5 million with expenditure up just 10.6%; as a result the average expenditure per visitor fell slightly by 0.6% (these are in nominal terms so the real decline would be about 2%).

Better still was the TNQ result. Visitor numbers rose by 13.3% although the average expenditure per visitor fell by 4.2%.

As a result Queensland’s share of the international visitor market has improved to 34.2% (was 33.9% a year ago) while TNQ also sees improvement to 11.9% (up from 11.6% in June 2015).160831

When we consider the TNQ data in more detail we see that, once again, the Chinese have been responsible for a good deal of the out-performance. Visitors from China to the region grew by 33.1% (up 22.7% to Australia overall). The US continues recent strong form up 18.1% with Japan also recording solid growth (up 17.6%). Visitors from the UK were up just 4.9% for the year.

The National Visitor Survey should be released in a fortnight.

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