Travel Is Bouncing Back, but Tourists Stick Close to Home
Asia and Europe are seeing upturns; Covid-19 surge dims some enthusiasm in U.S.
ANew Zealand ski resort recently staffed up as locals piled in. Vacationing South Koreans, with few foreigners in sight, pack the buffet lines at fancy hotels. Cottage rentals in the U.K. have nearly doubled over last year—mainly driven by British travelers.
In many parts of the world, travelers are out and about again. But they are staying closer to home, driving a welcomed rebound in tourism as few have the ability to venture off to faraway destinations.
The coronavirus pandemic ripped a hole in the $9 trillion global tourism and travel industry. For months this spring, people could barely venture outdoors, let alone whisk away for vacation. That has created pent-up travel demand now getting uncorked locally as lockdowns lift and stimulus funds are dispersed.
“Travel will rebound sharply because people would like to celebrate a return to normality,” said Andreas Papatheodorou, an economist at Greece’s University of the Aegean who specializes in tourism.
The rise in homegrown tourism won’t fully replace pre-pandemic revenue, and some tourist-town locals have bristled at out-of-towners possibly bringing the virus with them. But it is an important boost following months of almost no travel spending, economists and companies say.
The upturn is most pronounced in Asia, where the virus emerged and where many countries have largely corralled contagions. Europe is seeing a similar trend. In the U.S., some domestic travel has rebounded, though renewed spikes in Covid-19 cases have undercut some initial enthusiasm.
In Queenstown, New Zealand, where it is currently winter, so many locals flocked to the area’s pristine snowcapped mountains that the Coronet Peak ski resort scrambled to add staff. In just several weeks, the number of workers at the resort ballooned from around 100 to 160, said Nigel Kerr, Coronet Peak’s ski area manager.
“It is well above our expectations,” said Mr. Kerr, who was surprised because the country remains almost entirely closed to foreign travelers.
The travel and tourism industry, in a baseline scenario, was projected to decline this year by about 40%, or roughly $3.5 trillion, according to the World Travel & Tourism Council, a trade group, in a June report. Foreign visitors would plunge by more than half, the group estimated, while domestic travelers would fall by one-third.
But travel activity that all but disappeared for months this spring is now bouncing back.
Airbnb recently surpassed one million global bookings a day earlier this month—the first time since March, the company said.
Chris Lehane, the home-sharing giant’s global policy vice president, said bookings were now at the same level as last year, just that 90% of that travel was now domestic.
“People are using the money that they would be saving from airfares to potentially get bigger accommodations,” he said, adding that some people were also making bookings for multiple trips over the summer.
Hyatt Hotels Corp., during May and June, saw occupancy rates in Shanghai and five other Chinese cities that were higher than the year-ago period—even as Beijing kept the country’s borders largely closed. Sykes Cottages Holdings, which rents properties across the U.K.,
reported a 159% increase in bookings in recent weeks versus the same period last year.
“The months ahead are set to be extremely busy, with properties booking up fast and Brits eager to take a much-needed break,” said Graham Donoghue, CEO of Sykes Cottages.
In South Korea, Choi Jun-ho, a 30-year-old financial asset manager in Seoul, was planning to honeymoon in Hawaii this summer before the coronavirus hit. Wary of international travel, he switched to South Korea’s Jeju Island, a destination with beaches and volcanic craters. Jeju’s car rental lots are empty. And people must wait to be seated at snazzy hotel buffets.
“The new boom in local visitors makes it seem less exotic,’’ he said. “Still, I’m just happy I can vacation somewhere.”
Local travelers are getting enticements to vacation. South Korea will unleash about $750 million in loans and subsidies, while Vietnamese officials have launched a domestic tourism campaign offering subsidies and ticket price reductions. Taiwan’s government is offering citizens subsidies and discounts worth $130 million.
The number of domestic Chinese tourists has consistently grown since March, according to Trip.com Group. The increase generated $1.36 billion in tourism revenue over the recent
Dragon Boat Festival holiday. A promotion last month by Shanghai-headquartered China Eastern Airlines Corp. offering unlimited flights every weekend until the end of the year drew an enthusiastic response, boosting passenger loads on some of its domestic flight routes by 90% from prior campaigns.
In Japan, where domestic travel has re-emerged, the government is hoping vacation spending will rise further as Prime Minister Shinzo Abe readies $10 billion in subsidies promoting domestic tourism. However, a recent wave of infections has forced the government to scale down the program for now and may hold back a travel revival.
Australia hasn’t earmarked government dollars but it is making a public pitch. Tourism Minister Simon Birmingham suggested citizens had a “patriotic duty” to travel locally. He pointed out the country’s projected lost revenue from foreign tourism of about $30 billion is a similar amount to what Australians spent on overseas jaunts last year.
In some cases, domestic tourists are creating tension, especially among locals who don’t feel ready to embrace visitors as coronavirus continues to circulate.
Local government officials in Cornwall in England, a rural coastal county, said some 70,000 to 80,000 people arrived there on the weekend of July 4, many from cities such as Birmingham or London. With just one hospital to serve 500,000 locals, unhappy residents held a sign on a pedestrian bridge advising motorists to “turn around and f— off.”
The U.S., too, is seeing its own miniboom of domestic tourism, though recent surges in Covid-19 are raising concerns about its sustainability. Yosemite National Park closed just days after reopening in June, while hotels in Las Vegas are anxiously watching for Covid-19 spikes.
The number of Americans planning foreign trips has dipped to the lowest this decade, according to consumer data released last month by the Conference Board, a New York-based business think tank.
“People do want to travel, that’s innate,” said Mr. Lehane, the Airbnb executive. “In many ways because people were locked down for so long, that desire and interest in human connections was only reinforced.”