13 June 2022
The inbound prospects and outlook for the 22-23 international visitor season has changed over the past two months, for the positive… Previously when NZ still had a 7-day self-isolation requirement, pre-departure and arrival testing for all international visitors, there was a lot of frustration by offshore travel sellers to sell and book NZ and we were concerned about the start of our recovery. Bookings were slow. The self-isolation requirement was a major barrier.
When that requirement was removed (March 2022), inbound tour operators saw an array of bookings start to come through which was an encouraging sign. There is still some hesitancy for offshore sellers to sell NZ with confidence until pre-departure testing is removed. This has affected a number of bookings that were in the system for Q4 cancel bookings, particularly out of Australia. Whether these bookings will return to NZ in the 22-23 season is yet to be seen.
Many travellers including Kiwis are finding pre-departure testing and the traveller declaration form extremely frustrating and stressful in the 24-hour period prior to departure. We hope to hear from government shortly that these requirements will be removed, earlier than the proposed 31 July date. When this happens, we expect to see a flurry of bookings come through that have a higher level of confidence to materialize…and then we can start to approach the future with more confidence.
TECNZ is currently forecasting a 55-60% return of pre-COVID visitor arrivals and spend by YE May 2023. If we can achieve that without Chinese airlines flying in the Oct-Dec 2022 period, it will be a solid start to NZ’s international tourism recovery and rebuild. We anticipate the 22-23 season will be a game of two halves. The Oct-Dec 2022 period will have a higher weighting of independent travellers (VFR and leisure) than group travel. Business event travel is looking steady for Q4 of this year. We expect more visitors from Australia, US, Canada, UK and European markets than Asian markets although we anticipate travel from Singapore, Hong Kong, South Korea and Taiwan will start later in the year.
The second half of the season Jan-Apr 2023 will see a stronger level of group tours return that will complement FIT travel. We’ll see a larger pick-up out of the UK and Europe market in Q1 of 2023 and higher level of return of visitors from Asia-Pacific. The UK and European markets have been the most concerned about NZ not giving enough notice and removing travel barriers. We’re not sure yet when China will reopen for travel partly influenced by government policy and airline connectivity. We hope to see the China market return mid-late 2023.
Inbound bookings in the system for the 23-24 are looking good and there’s a higher level of optimism and confidence from all markets for that season vs the 22-23 season which will be a bit of a watch and see as to what unfolds. TECNZ forecasts a return of potentially 82-85% pre-COVID arrivals by May 2024 and close to 95% return of pre-COVID arrivals by May 2025. Time will tell as to whether our crystal ball is on point, too optimistic…or a bit foggy.
Our pick for star performer for the season will be Australia and the US markets. A couple of trends we are seeing include longer stays, higher spend and heightened interest in health and safety and sustainable business practices across operations. The role of travellers using outbound travel agents to connect with NZ inbound tour operators to have someone looking after their ‘duty of care’ while travelling continues to grow. This is a good sign for the ongoing future of ITOs and the work they do on behalf of the industry for a safe and well-managed rebuild of NZ’s international tourism offering.