Bay of Islands tourism predicts “devastating” summer

  • Destination marketing group shuts doors to hibernate
  • Marketing cash to be spent on “survival”

Tourism operators in the Bay of Islands are worried that summer trade will be “devastated” following the decision to keep Northland at red settings in the COVID Protection Framework, and the impact of the national discussion surrounding the check points keeping Northland at arm’s length from the rest of the country. The Bay of Islands Marketing Group, an organisation established by local businesses to market and promote the area as a tourism destination, is going into “hibernation” pending a decision to stop its work permanently.

Input from Mid and Far North tourism businesses gathered in response to Far North Mayor John Carter’s request for a prognosis for the 2021/22 summer season paints a woeful picture. Responses show that revenue forecasts are down by between 50 to 90 percent, year on year.

The feedback amplifies data provided by economics consultancy Infometrics to the Bay of Islands Marketing Group and the regional economic development agency Northland Inc, showing that domestic tourism spending on accommodation services in Northland between the start of August and the end of October this year was less than half of the 2019 figure, food and beverage was down by approximately 30 percent and passenger transport services were down by nearly 80 percent.

Riki Kinnaird, Chairman of the Bay of Islands Marketing Group and co-owner of the Duke of Marlborough Hotel in Russell, said 2019 had been used as the benchmark because this was the last “clean” year before COVID-19 started impacting and distorting the figures.

“August to October was when the hit from the Delta outbreak restrictions kicked in and Northland was isolated from the rest of the country, effectively ‘islanded’ by a locked-down Auckland,” Mr Kinnaird said.

“The Infometrics data for this period substantiates what our business community has been telling us: the Northland region has been hit hard by our isolation. Holding Northland in a red setting while the rest of New Zealand moves to orange has put our businesses at a competitive disadvantage to the rest of New Zealand. The noise around the checkpoints and the message this sent, that Aucklanders were unwelcome, has compounded the damage.”

Infometrics could not provide the Bay of Islands Marketing Group and Northland Inc with an outlook for domestic tourism spending for Northland because “uncertainty of summer 2021/22 with Northland being in ‘Red’ … makes it difficult to forecast or provide realistic scenarios for domestic traveller spending.”

Mr Kinnaird said that position underscored the seriousness of the uncertainty facing the sector.

“If an economic intelligence consultancy like Infometrics says the outlook is too difficult to call how on earth is a motelier in Paihia supposed to plan? There is a huge lack of forward demand, nothing at all on which to base planning on except a deep, seemingly endless bookings void.”

The Infometrics report outlines three scenarios relating to international tourism spend in Northland. The most favourable outlook shows revenues taking four more years to return to pre-pandemic levels. The least optimistic says the value of international leisure travel to the region will still be 40 percent lower than pre-pandemic levels in December 2026.

This leads the Bay of Islands Marketing Group to speculate that there will be “substantial shuttering” of the Northland tourism sector. It is starting with itself. Over the past seven years member businesses have spent $1,975,000 on promoting the Bay of Islands as a tourist destination; this work will now stop as they consider how best to weather the storm.

“The Infometrics data shows that our Bay of Islands businesses have been under immense pressure for some time. We need to spend cash earmarked for tourism promotion on our own survival. It’s as simple as that,” Mr Kinnaird said.

The group is hearing from many local tourism businesses that they were planning to go into “hibernation mode”.

“Faced with the carnage of this season’s pending flop and impact of being in lock-down from August, with no prospect of a return of the international tourism dollar for at least another four years, many of our members are simply calling it a day.”

All of the businesses who provided input to Mayor Carter described an environment where Northland was perceived by potential customers as “too difficult”, with “bucket loads” of cancellations arising from the fact that the region is in red and the national discussion around blockades on roads leading to the north.

“It’s all very well politicians telling us that, technically, there’s nothing stopping vaccinated and COVID-free travellers heading north,” Mr Kinnaird said. “But this summer is where political rhetoric meets the brick wall of reality. Northland is far enough away without the risk of potential delays caused by blockades, and after two years of COVID who wants to head for their summer break into a more restricted environment than the one they’re currently in?”

Before last week’s announcement about the ‘traffic light’ status of New Zealand’s regions Mr Kinnard had been calling for Cabinet and officials to use the new system in a “targeted, refined and ‘smart’ way” that would see a move to orange for the better-vaccinated parts of Northland that are dependent on domestic tourist traffic.

“Northland’s a big place and the traffic light system was promoted as being able to address the requirements for restriction on a very localised basis,” he said. “So why are we labouring under a blunt, blanket region-wide red?

“There are two things keeping people away this summer, the red traffic light setting and the optics around the checkpoints. Our business community are eager and excited to welcome visitors back to the Bay of Islands but we are restricted in our ability to do so. If we must have checkpoints can we not at least have orange settings here in the Bay which is so dependent on tourism and where the vaccination rates are reasonably good and getting better?

“Let’s make this COVID Protection Framework as nimble as businesses have had to be for the past two years. Our businesses need some nimble thinking from officials at this terrible time.”

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