From SARS-struck to flu-flattened

It was the worst June for Hawaii tourism since 2003, the summer of SARS, and for a similar reason, as Japanese visitor numbers plunged by more than a third on swine flu fears, the state Department of Business, Economic Development & Tourism confirmed Tuesday. The Japanese are usually the visitors who spend the largest amount of money per day, but they also take the shortest vacations. Japanese arrivals have rebounded this month and won't be down anywhere near so much. But don't expect July to be a lot better than June. Total visitor arrivals for June fell 5% from last year but spending fell 16%, to the point where the $5 billion annual spending milestone that we usually reach in May or June did not arrive until sometime this month. Spending fell three times as much as the actual visitor count because hotels are still discounting their room rates from 10% to 20%, roughly speaking, and other hospitality vendors are doing the same thing. A return of the Japanese won't change it that much. We'd have to get 20% more visitors than last year to make up for these low room rates. As a practical matter, it would never happen that way, because resurgent visitor numbers would cause hotels to boost rates, but it is still true that it would take a significant rebound to embolden hoteliers to try that. About the only good news is that the cheap rates are bringing some first-time visitors who simply could not afford Hawaii before. The reason this is good news is that first-timers always come back. A first-time visitor is a future repeat visitor, even if it costs a lot more the second time.