Cruising along: Airport volumes are up, cruise ship traffic strong, hotel revenues on the rise, and food and drink sales growing
By JOCK FINLAYSON
and KRISTINE ST. LAURENT
Business Council of B.C.
IT TURNS OUT that 2017 marked a 14-year high for annual international tourism to B.C. Some 7.9 million international travellers entered the province last year, an increase of 3.5 per cent over 2016. And the data for the first quarter of 2018 look even better, setting the stage for another record-breaking year for the industry.
Who visits B.C.?
Since 2010, the number of international visitors is up nearly a quarter. That’s partly attributable to strategic marketing in Europe, Asia and other high-priority foreign markets. Americans make up the biggest share of B.C.’s foreign visitor profile, accounting for nearly three-quarters of all international travellers. However, the province has also seen sizable increases in visitors from other key markets such as Mexico, Australia and China.
Indeed, China has emerged as B.C.’s number two international tourism market, with the province welcoming more than 300,000 Chinese visitors last year. Even more Chinese tourists are expected in 2018 as January marked the start of the Canada-China Year of Tourism. The province recently struck a deal with WeChat, China’s largest social networking app, to promote tourism in B.C., which should lead to a further boost in Chinese tourists over the course of 2018.
Arrivals by air and boat
The growth in international visitors is supported by the expansion of flight capacity between Vancouver International Airport (YVR) and a number of international cities. Over the last eight years, YVR’s passenger volume has risen three-fold, as the airport went from serving almost 17 million travellers in 2010 to 24 million in 2017.
Policy changes, such as the federal government’s decision to lift visa requirements for Mexican travellers at the end of 2016, have influenced airlines’ decisions to increase flights out of YVR. So has the steady growth of middle-class populations in China and other emerging economies in the Asia-Pacific region.
Vancouver’s cruise ship market is also busy. The Port of Vancouver estimates that almost 900,000 cruise passengers on 241 vessels will visit Metro Vancouver in 2018. Each cruise ship docking at Canada Place represents close to $3 million in direct local economic activity in retail sales, food and attraction sales, and other tourism-related spending.
B.C. Ferries has reported relatively stable passenger volumes since 2010. In 2017, the corporation transported 21.8 million passengers on all routes; this year, it expects the number to reach 22 million. In the fiscal year April 1, 2017, to March 31, 2018, B.C. Ferries saw a record number of vehicles moved. Increased business on the province’s ferries partly reflects a robust tourism industry.
Other categories of spending
Not surprisingly, visitors enjoy eating and drinking at West Coast establishments. Food and drink spending at B.C. restaurants and bars is up over a third since 2010. While the food and drink receipts data include expenditures by B.C. residents, hungry and thirsty tourists are helping to lift the restaurant business.
Hotels in many areas of B.C. are seeing more rooms filled on a consistent basis throughout the year. On average in 2017, hotel rooms were 70 per cent full across the province – an occupancy rate 10 percentage points higher than in 2010. The province-wide average rate charged for a hotel room also rose, by about $10 per night annually over the last four years.
As a result, hotel and motel room revenues have jumped since 2010. Vancouver room revenues have posted particularly impressive growth, increasing by $250 million in the last eight years. Other municipal jurisdictions such as Whistler, Victoria, Richmond and Kelowna have also experienced solid gains in overall room revenues.
This year and beyond
First-quarter tourism data released by Destination B.C. indicates that the industry is on track for another impressive year. The province hosted more than 1.3 million international visitors in the first quarter of 2018, a 7.8 per cent increase over the first quarter of 2017. From the beginning of this year until the end of March, Vancouver and Whistler room revenues exceeded $300 million, compared to $225 million over the same period last year.
With the combination of a weak Canadian dollar, a buoyant U.S. economy, and expanding commercial and travel ties between British Columbia and Asia, the province’s tourism industry should continue to cruise along in 2018.
Jock Finlayson is executive vice-president of the Business Council of British Columbia. Kristine St.-Laurent is a senior policy analyst at the BCBC.
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