How is the Travel Sector shaping up in New Zealand, any New Year cheers?

Summary

• Coronavirus pandemic triggered an unmatched crisis in the once flourishing tourism industry of New Zealand, leading to widespread job and revenue losses.
• Kiwis would be granted access to 2 of the Australian states and permission to fly from New Zealand to NSW, and Northern territory without the mandatory quarantine from 16 October.
• After the announcement of new rules, Qantas and Jetstar have started selling scheduled flights across Tasman.
• Modelling by Tourism NZ showed that the number of Kiwis travelling around in NZ could jump by 118% in January 2021. 

Travel and tourism sector turned into the most observable victim of COVID-19 pandemic after New Zealand, along with the whole world, had imposed harsh lockdown restrictions and closed the borders to fight the coronavirus spread. 

The tourism industry has been one of the hardest hits, losing workforce and revenue as visitors withered amid virus-induced lockdown.

Travel restrictions in the absence of international flights, as well as cruises have led to an enormous reduction in the number of tourists causing an adverse impact on airline, hotel, and travel industries.

Australia opens trans-Tasman bubble 

The trans-Tasman bubble is opening up an exclusive travel corridor between NZ and Australia. The travel bubble has been in discussions since May but was put on hold due to community outbreaks of coronavirus in both the countries.

On 2 October, Australian Prime Minister Scott Morrison declared that Australia would permit Kiwis to enter 2 of its 8 states and territories within a fortnight. People would now be able to travel from NZ to New South Wales (NSW) and the Northern Territory and avert obligatory quarantine from 16 October.

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However, travel would be only one-way as NZ PM Jacinda Ardern stated that the country was still not ready for a quarantine-free journey. NZ Travellers must not have been living in a COVID-19 hot spot in the nation from the last 14 days to travel quarantine free.

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Australia defined hotspot by a 3x3 definition- any area with at least 3 local infections per day across a 3-day rolling average.

Michael McCormack, Australian Deputy PM stated that the travel zone between Australia and NZ has been completed. It is also the first stage of the trans-Tasman bubble between 2 countries.

Mr McCormack also revealed that the new travel bubble would free up space for about 325 passengers a week to enter quarantine in Sydney so that more Australians abroad can return home.

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Ardern stated that any Kiwi resident who opts for Australia’s offer would have to quarantine on their return. She asserted that opening up of borders with Australia is not an option until it is safe to do so and opening borders early can result in losing all the freedom the country has been enjoying presently.

Domestic tourism to surge in January 2021

New modelling by Tourism NZ has estimated that the number of Kiwis travelling around in NZ could jump by 118% in January 2021. Further, if trans-Tasman borders open by a “pragmatic estimate” of January 2021, visitors from Australia could grow the economy by $1 billion by September 2021. 

Stephen England-Hall, Chief Executive of Tourism NZ, stated that the modelling shows that the travel demand would be back at the levels seen in 2019 by December 2022, though the duration for recovery remains to be uncertain.

The latest domestic spend data by the Ministry of Business Innovation and Employment (MBIE) showed that Kiwis are helping the economic recovery of NZ by exploring the country and doing something new.

Mr Hall stated that although domestic visitor expenditure for August stayed flat compared to last year, it was an incredible result, as people in Auckland were not able to travel for the majority of the month.

He also added that in the July school holiday season, domestic visits increased across all areas, in some cases by a massive 20-50% relative to the previous year, and the domestic visits could witness a parallel rise in the September school holidays.

Until the pandemic, domestic tourism accounted for 60% of the $40.9 billion contribution from tourism to the NZ economy. Earlier, Kiwis invested $9 billion a year going abroad. 

Mr Hall stated that work is in the process to promote domestic tourism and capturing the spend would be crucial for the recovery of the tourism sector.

Airlines boost domestic flights as borders reopen

After the trans-Tasman news, Qantas and its subsidiary Jetstar have been fast in selling flights across Tasman. The airlines also stated that new routes, which were not offered previously were expected now as more Australian cities opened up from NZ to Australia.

Air NZ stated that changes had permitted it to remove caps on many flights into Sydney, resulting in an extra 12,000 seats amid present time and January. The flight operator has continued operating limited services from Auckland to Sydney, Brisbane, and Melbourne throughout coronavirus.

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Alan Joyce, Chief Executive of Qantas, appreciated the travel bubble news, stating that Qantas will now be able to get back more flight services in the sky and more people return to their jobs.

Greg Foran, Air NZ Chief Executive, stated that the one-way travel bubble was an encouraging step towards opening up a Transman bubble. 

(NOTE: Currency is reported in NZ Dollar unless stated otherwise)