OUTBOUND TREND TO CONTINUE

AUSTRALIAN travel patterns are relentlessly shifting towards overseas holidays, with an analysis of the latest figures indicating people are prepared to spend money on vacations regardless of their personal circumstances. That was one of the key findings presented by John O’shea, travel & tourism analyst from Bell Potter Securities during a session at last month’s Travel Industry Exhibition.

Rather than currency effects, the main driver of outbound demand is household disposable expenditure, with O’shea insisting that a low Australian dollar hasn’t dampened the seemingly insatiable demand from Australians to holiday abroad. Key factors include very cheap fares, while demographics also have a part to play as “Millennials” have now started their lives travelling and look set to continue the pattern for years to come. At the other end of the spectrum people are staying healthy for much longer, with seniors keen to experience the expanding array of holiday product available overseas.

Despite a recent strong increase in domestic holidays, particularly to Queensland, O’shea noted this was off a very low base. “It’s great news for those destinations, which have been suffering from very low occupancies in recent years,” he said. But the relentless trend of outbound holiday expenditure versus domestic (see top graph) looks set to continue, meaning in the not-too-distant future Australians as a whole will be spending more on outbound than domestic holidays – something which would have been hard to believe just a few years ago.

O’shea specialises in slicing and dicing the various statistics available, and also presented an intriguing insight into the fastest growing destinations for Australian outbound travel. These include Pakistan, Japan, Papua New Guinea, northwest Europe and New Caledonia (right).