Travel Trends for USA and Utah: An International Perspective

1
Travel Trends for USA and UtahAn International
Perspective
Presented to The Utah Travel Tourism Industry
Presented by Mark Brown Office of Travel and
Tourism Industries MANUFACTURING
SERVICES International Trade Administration U.S.
Department of Commerce May 2010
2
Agenda for Today

• Overview of OTTI Commerce Travel Tourism
  Services
• Travel Trends for the U.S. Western USA
• Forecast for International Travel
• Policy and Promotion Issues
• Q A

3
Who is OTTI?
The National Tourism Office for the U.S.
4
Department of Commerce Agencies Involved

• Department of Commerce (DOC)
• International Trade Administration (ITA)
• Manufacturing and Services (MAS)
• Services (S)
• Office of Travel and Tourism Industries
  (OTTI)

5
What We Do at OTTI
6
U.S. Integrated Statistical Systemfor Measuring
International Travel Tourism
7
U.S. Department Of CommerceInternational Trade
Administration Tourism Resources
OFFICE OF TRAVEL TOURISM INDUSTRIES
Office of Domestic Operations 105 U.S. Offices
Foreign Commercial Service 151 Offices in 83
Countries
http//www.buyusa.gov/eme/tra.html
http//trade.gov/cs/
8
Impact of Travel on the U.S. Economy(2009)
Source U.S. Department of Commerce Office of
Travel and Tourism Industries Bureau of
Economic Analysis.
9
Travel and Tourism Employment(2009)

• Food Services and Drinking Places
• 2.5 million employees (31)
• Traveler Accommodations
• 1.6 million employees (20)
• Shopping (Retail)
• 844 thousand employees (10)
• Air Transportation Services
• 757 thousand employees (9)

Travel and tourism industries support 8.2 million
American jobs!
70 of all travel and tourism employment is
accounted for by four sectors
Source U.S. Department of Commerce, Office of
Travel and Tourism Industries, Bureau of Economic
Analysis.
10
International Travel Tourism to the U.S.(2009)

• Largest services sector export 121 billion in
  2009.
• Third-largest merchandise/services export
  category.
• Generated a trade surplus of 22 billion.
• Supported 1.1 million jobs.
• International travelers spend 4-7 times more than
  domestic travelers on a trip
• Length of the trip is 2-4 times greater than
  domestic travelers.
• International travelers have higher activity
  participation rates than domestic travelers.
• International travelers were more inclined to
  stay at hotels/motels rent cars than a domestic
  traveler.
• 4 of travelers, but 17 of traveler spending,
  payroll, employment and taxes.

11
Global Travel Trends
12
World Tourism Arrivals Receipts(1980-2010)
2009p 880m 878b
Source U.N. World Tourism Organization
13
Top Ten Country Rankings of GlobalVisitors and
Receipts (2009/2008)
The United States leads the world in global
travel and tourism exports (spending receipts)
and ranks 2rd in global visitation.
Destination 2008 World Destination
2009 World Rank Country Receipts Share Country
Visitors Share (bil) () (mil) ()
All Countries 944 All Countries 880 1 Uni
ted States 110 11.7 France 74 8.4 2 Spain 6
2 6.5 United States 55 6.2 3 France 56
5.9 Spain 52 5.9 4 Italy 46
4.8 China 51 5.8 5 China 41
4.3 Italy 43 4.9 6 Germany 40 4.2 United
Kingdom 28 3.2 7 United Kingdom 36
3.8 Turkey 26 2.9 8 Australia 25
2.6 Germany 24 2.8 9 Turkey 22
2.3 Malaysia 24 2.7 10 Austria 22
2.3 Mexico 22 2.4
U.S. Air Carriers
Source U.N. World Tourism Organization. Latest
data available and excludes air passenger fares
(31.6 billion for U.S. alone). World shares
based on unrounded data.
14
Top 15 Non-Asian Countries vs. AsiasShare of
Global International Arrivals (2002 - 2011)
The top market share trend line includes the
top 19 world destination countries excluding
China (ranked 5), Hong Kong (ranked 12),Malaysia
(ranked 15), and Thailand (ranked 18). The 4
Asian countries market share is forecasted to
grow from 11.4 in 2002 to16.2 in 2011,
depicted in the lower trend line. Sources Office
of Travel Tourism Industries, International
Trade Administration, U.S. Department of
Commerce Global Insight, Inc.
15
Travel Trends to the U.S.
16
U.S. Visitors Spending(1996-2009)
Visitor spending (receipts) closely mirrors
visitor volume. Spending was a record 121.1
billion in 2009, while visitor volume was 54.9
million.
Spending
Visitors
Sources Department of Commerce, Office of
Tourism Industries Department of Commerce,
Bureau of Economic Analysis Statistics Canada
Banco de Mexico.
17
Top Origin Markets forInternational Travelers to
the U.S.
Origin of Visitor 2009p 09 / 08 10/09 Feb.
YTD (000s) ( change) ( change)
International Total 54,884 -5 15 1 Canada 17
,964 -5 53 2 Mexico 13,164 -4 3 Overseas
23,756 -6 10 3 United Kingdom 3,899 -15 -3
4 Japan 2,918 -10 11 5 Germany 1,687 -5 4 6
France 1,204 -3 3 7 Brazil 893 16 34 8 Ita
ly 753 -3 9 9 South Korea 744 -2 47 10 Austr
alia 724 5 28
International travelers include all countries
generating visitors to the U.S. Overseas
includes all countries except Canada and Mexico.
Record year for Travel to U.S.
18
Top Ten Travel Export Markets(2009 record
receipts/year)
Total Travel Record Year Receipts Travel
Record Origin Country 2009p Receipts
Set (bil) (bil)
Canada 16.22 18.66 2008 Japan 12.88 17.80 199
5 United Kingdom 12.13 17.72 2008 Mexico
8.34 9.74 2008 Germany 5.60 6.68 2008 Brazil
4.25 2009 France 4.23 4.78 2008 India 3.58 4
.29 2008 China 3.50 3.61 2008 Australia 3.31
3.70 2008 U.S. TOTAL 121.07 141.71 2008
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Top U.S. Destinations1 for Overseas
Visitors(2008)
Top Market Top Market States Share Cities Share
New York 33.2 New York City 32.4 California 20.9
Los Angeles 11.0 Florida 20.7 San
Francisco 10.3 Nevada 8.3 Miami 10.2 Hawaii 7.2
Orlando 9.6 Illinois 5.6 Las
Vegas 8.0 Massachusetts 5.0 Honolulu 5.9 Guam
4.7 Washington, D.C. 5.5 Texas 4.3 Chicago 5.4
New Jersey 4.1 Boston 4.4
1 These percentages are based on multiple
responses. Main destination (one response) is
also available.
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Western USA Visitors by Origin Country (2008)
Visitor Share Western USA Origin
Country Visitors of Western USA Share of
Country (000s) () () TOTAL OVERSEAS 25,341
- - - - - - Western USA 7,577 - -
- 29.9 1 United Kingdom 1,260
16.6 27.6 2 Mexico (air) 837
11.0 49.0 3 Japan 702 9.3 21.6 4 Germany
579 7.6 32.5 5 Australia 417
5.5 60.5 6 France 389 5.1 31.3 7 South
Korea 350 4.6 46.1 8 China 299
3.9 60.6 9 India 297 3.9 49.6 10 Netherland
s 235 3.1 38.7
Note Overseas includes all countries except
Canada and Mexico.
21
Western USA Visitors by State (2008)
Western USA State Share State
Share Destination State Visitors of Western USA
of Overseas (000s) () () TOTAL OVERSEAS
25,341 - - - - - - Western USA States
7,577 - - - - - - California 5,296
69.9 20.9 Nevada 2,103 27.7 8.3 Texas
1,090 14.4 4.3 Arizona 710
9.3 2.8 Washington 456 6.0 1.8 Utah 380
5.0 1.5 Colorado 380 5.0 1.5 2-year
average Oregon 184 2.5 0.7 Wyoming 84
1.1 0.4 Alaska 64 0.9 0.3 Montana 44
0.6 0.2 Idaho 35 0.5 0.1
Note Overseas includes all countries except
Canada and Mexico.
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Travel Characteristics of Visitors fromTop
Origin Markets (2008)
Travel U.K. France Western USA Characteristic
Overseas Germany Japan
of nights in U.S. 16 14 16 16 8 21 1st-time
U.S. 24 15 23 29 31 22 Party
Spending in U.S. 5,939 5,902 5,181
5,336 5,619 7,163 Purpose of trip (net) 1
Leisure / Rec. / Holiday 64 70 60
62 78 58 Visit Friends/Relatives 33
28 35 37 16 38 Business /
Convention 33 28 35 31 21 45
1 These trip purpose items are based on multiple
responses. Main purpose of trip (one response)
is also available.
23
Information Sources Used by Visitors fromKey
Markets to the U.S. (2008)
Information Overseas U.K. Germany France Japan W.
USA Sources () () () () () ()
Personal Computer 41 48 47 44 45 40
Travel Agency 39 29 26 33 48
42 Airlines Directly 20 23 28 23 10
21 Friends/Relatives 15 13 15 11 15
15 Corporate Travel Dept. 9 9 14 9 7
12 Travel Guides 8 7 14 7 18 8 Tour
Company 7 6 4 5 25 5 State/City Travel
Office 4 1 19 1 1 4 Newspapers/Magazines
3 2 3 1 8 3 Advance Decision
(days) Trip Decision 87 118 104 97 68 8
9 Airline Booking 61 94 74 67 43 58
Note Multiple choice responses allowed for
information sources.
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Activity Participation while in the U.S.(2008)
Information Overseas U.K. Germany France Japan W.
USA Sources () () () () () ()
Shopping 88 88 84 83 89 85 Dining in
Restaurants 84 94 85 83 85
87 Sightseeing in Cities 44 42 36 46 48
49 Visit Historical Places 38 37 45 49
15 42 Amusement/Theme Parks 26 32 25 20
14 31 Visit Small Towns 26 26 31 23 29
33 Art Gallery/Museum 22 19 26 37 7
22 Cultural Heritage Sites 22 21 40 32
12 27 Water Sports/Sunbathing 22 26 23 16
37 16 Touring Countryside 19 21 37 17
15 28 Visit National Parks 18 20 26 22
7 32 Guided Tours 17 18 16 16 20
19 Concert/Play/Musical 16 17 17 21
8 18
Note Multiple choice responses allowed for
activity participation.
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Overseas Travel to Utah2006-2008 average

• Utah share of total increasing past four
  years1.2, 1.4, 1.5, 1.6
• Trip purpose to USA(net)
• 73 leisure/vacation
• 19 business
• 10 convention
• 9 visit friends/relatives

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Utah Overseas Visitors by Origin
Country(2006-08)
Visitor Share Origin Country Visitors of
Utah () Utah Overseas 325,000 Western
Europe 212,000 65 France 48,000 15 United
Kingdom 47,000 14 Germany 40,000 12 Netherland
s 27,000 8 Asia 54,000 17 Japan 16,000 5 So
uth Korea 10,000 3 China (PRC) 8,000 2 Oceania
17,000 5 Australia 12,000 4 South
America 15,000 5 Brazil 9,000 3
27
Traveler Volume from Canada(stays of 1 or more
nights)
Pre-2009 2009p Forecast All-time Record
Source Statistics Canada.
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Canadian Visitors to Western USA States (2008)
U.S. State Visitors Visitor-Nights Spending
(000s) (000s) (000s)
TOTAL U.S. (NET) 18,914 146,602 12,159,398
Western US (sum 2008) 7,317 41,921 3,993,500
Washington 2,142 6,078 461,309
California 1,257 10,774 1,072,402
Nevada 1,059 4,936 867,651 Montana 650 2,035
192,398 Arizona 515 8,587 564,131
Oregon 409 1,386 104,080 3-Year
Average Texas 371 3,749 301,367
Idaho 259 757 60,604 Utah 171 754
84,329 Colorado 145 825 108,707
Wyoming 88 236 19,829
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Canada to Utah3-year averages based on 2006-2008
combined data (1 nights)

• Visitors 171 thousand producing 754 thousand
  visitor-nights.
• Spending 84 million /visitor 493
  /visitor/night 112.
• Purpose holiday/vacation-65 VFR-17
  business-14 other-4.
• Stay length 4.4 nights, 1 night-30 2-6
  nights-49 , 7 nights-21
• Province Alberta-39 Ontario-26 BC-20
  Saskatchewan-8.
• Mode auto-58 Air-38.
• Accommodations hotel-53 f/r-10 not stated
  20 (RV?).
• Age 55 or older-54 children under 20-6.
• Timing Q2-30 Q1-27 Q4-26 Q3-17.

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Forecasts for International Travel
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UN/WTO Forecast for World Arrivals Spending
for 2009 2010

• 5 decline in world arrivals for 2009.
• The UN/WTO forecast for travel spending in 2009
  is to expect a decrease of 6-8.
• For 2010, the UN/WTO forecast for world arrivals
  is a 1-3 growth rate.
• Asia will show the strongest rebound, Europe
  the Americas will probably take longer to
  recover.

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International Visitors to the U.S. and
Projections(2001-2015)
Arrivals in Millions
Sources U.S. Department of Commerce, ITA, Office
of Travel Tourism Industries Secretaria de
Turismo (Mexico) Statistics Canada IHS Global
Insight, Inc. -- May 2010 forecast
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The BRIC(K)s
Greenland
Sweden
Iceland
Russia
Finland
Russia
Norway
Estonia
Canada
United Kingdom
Latvia
Denmark
Lithuania
Belarus
Ireland
Poland
Netherlands
Germany
Bel.
Lux.
Czech Rep.
Ukraine
Slovakia
Kazakhstan
Moldova
Hungary
Austria
Switz.
Mongolia
France
Slovenia
Romania
Croatia
Italy
Bosnia Herz.
Serbia
Uzbekistan
Bulgaria
Montenegro
Kyrgyzstan
Georgia
Macedonia
N. Korea
Spain
Portugal
Azerbaijan
Armenia
Albania
United States
Turkmenistan
Turkey
Tajikistan
Greece
China
S. Korea
Japan
Malta
Syria
Cyprus
Lebanon
Afghanistan
Morocco
Iran
China
Tunisia
Iraq
Israel
Pakistan
Jordan
Kuwait
Nepal
Algeria
Libya
Egypt
Qatar
Bahamas
Western Sahara
Mexico
U.A.E.
Taiwan
India
Oman
Cuba
Saudi Arabia
Burma
Laos
Dominican Republic
Mauritania
Haiti
Mali
Jamaica
Niger
Belize
Thailand
Philippines
Honduras
Eritrea
Chad
Cape Verde
Yemen
Vietnam
Senegal
Guatemala
Sudan
Gambia
Cambodia
Nicaragua
El Salvador
Burkina Faso
Guinea-Bissau
Dijbouti
Guinea
Panama
Benin
Nigeria
Togo
Cote dIvoire
Costa Rica
Venezuela
Guyana
Central African Republic
Sierra Leone
Ethiopia
Suriname
Ghana
Brunei
French Guiana
Sri Lanka
Liberia
Somalia
Cameroon
Malaysia
Colombia
Equatorial Guinea
Uganda
Congo
Kenya
Rwanda
Gabon
Ecuador
Indonesia
Dem. Rep. of Congo
Burundi
Papua
Indonesia
Tanzania
New Guinea
Peru
Solomon Islands
East Timor
Brazil
Angola
Zambia
Vanuatu
Malawi
Bolivia
Zimbabwe
Namibia
Fiji
Mozambique
Paraguay
Chile
Botswana
Madagascar
Australia
Swaziland
Lesotho
South Africa
Uruguay
Argentina
New Zealand
34
Visitors to the U.S. from Brazil
7
000s of visitors
35
Brazil

• Positives Total outbound increasing trend. US
  share increasing. Economic and social
  environment on a roll. 9 consecutive monthly
  increases, many dramatic. Strong potential
  benefactor of any TPA impacts 2013.
• Negatives Potential World Cup cannibalization.
  Can US visa processing keep pace with demand.
• Forecast very strong growth.

36
Visitors to the U.S. from Russia
35
000s of visitors
37
Russia

• Positives Flat 2009 visitation despite massive
  GDP decline. Three months of solid growth to USA.
  Low GDP growth in 2010 changing to solid GDP
  growth. Outbound has doubled in ten years.
  Simplified visa processing. growing middle
  class. new flights. Could benefit from any TPA
  impacts, if only because it's a "BRIC."
• Negatives High inflation. USA share of total
  outbound stable. Population decline visitor
  growth must come from more outbound trips and/or
  US higher share of total.
• Forecast very strong growth.

38
Visitors to the U.S. from India
12
000s of visitors
39
India

• Positives 5 consecutive months of growth. Many
  of the down months in 2009 were the largest
  annual share months, so bar is low. Strong and
  growing GDP. Total outbound growing, US share
  varies. "Travel-worthy" middle class now
  estimated at 100 million of 1.1B. Low potential
  of any TPA impacts.
• Negatives can visa processing keep up with
  demand. Growth partially dependant increases in
  leisure travel, not just dominant business.
• Forecast very strong growth

40
Visitors to the U.S. from China (PRC)
14
000s of visitors
41
China

• Positives Seven consecutive months of monthly
  increases including near doubling in Feb. Will
  be a huge beneficiary of any TPA impacts.
  Tremendous growth in total outbound for more than
  a decade. U.S. share increasing since SARS.
  Very strong GDP growth. USA-China MOU.
• Negatives Shanghai World Expo might keep some
  Chinese home.
• Forecast Wowwie!

42
Visitors to the U.S. from South Korea
9
000s of visitors
43
South Korea

• Positives won at .000866 and stable. 6
  consecutive months of fantastic growth off of
  dramatic declines. Solid GDP growth, then strong
  growth. Industrial production fully recovered.
  Moderate beneficiary of any TPA impacts in 2013.
  Strong growth in total outbound up until 2008.
• Negatives Important Q3 was actually up in 2009,
  thus bar is not that low. US share of total
  outbound declining. Potential World Cup
  cannibalization.
• Forecast Very strong growth

44
National Export Initiative

• Goal Double exports over the next 5 years to
  support 2 million American jobs
• Creates Export Promotion Cabinet that will
  consist of leaders from top agencies
• Focuses on three key areas
• 1. Expand trade advocacy in all its forms by
• Educating U.S. companies about foreign
  opportunities
• Directly connecting them with customers
• 2. Improving access to credit for small-and
  medium-sized businesses that want to export
  through the Export-Import Bank, and
• 3. Continuing enforcement of international trade
  laws.

45
Travel Promotion Act

• Bill signed by President Obama on March 4, 2010
• Establishes an independent non-profit Corporation
  for Travel Promotion with a Board of Directors
  appointed by the Secretary of Commerce.
• PURPOSE
• To promote the U.S. to world travelers
• To augment USG communications on entry/exit
  policies

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Travel Promotion Act

• Umbrella - opportunity to shine beneath
• Exposure for top markets without full investment
  cost
• Work with corporation for travel promotion to
  ensure Utah product is seen!
• Better measures possible for ROI

47
Travel Regional Investment Partnership
ActT.R.I.P.

• H.R. 4676, introduced by U.S. Representative Sam
  Farr (CA).
• Creates a matching grant program in DOC to
  promote domestic tourism through local and
  regional partnerships.
• Administered by OTTI.
• CVBs, parks, resorts, attractions.
• Grants of 100,000 to 1 million from annual 10
  million fund. (5 years)

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The Quickest Way to U.S. International Tourism
Information http//tinet.ita.doc.gov

• Includes International Travel Research Online
• Order, read, download print the latest
  statistics on
• international travel to and from the U.S.
• All of the latest summary tables highlighting
  specific tourism trends
• More than 30 market and regional profiles
  available
• Forecast of international travelers to the U.S.
  through 2013
• Information on OTTIs nine on-going market
  analysis (research) programs
• Updated monthly statistics on arrivals and
  departures
• Late-breaking TI News announcements and
  information releases
• Links and information on the Commerce, Commercial
  Service Travel Tourism Team in the USA
  Abroad
• Links to other organizations in the travel
  industry
• Sign up for TINews, OTTIs FREE news service,
• for the latest in tourism industry news and
  program updates

49
(No Transcript)
50
Travel Summary WHTIthrough November 2009

• Visitors to U.S.
• Canada Visitation up past 4 months, but down
  prior to and thru pII.
• Canada Auto day visitors down 14 months prior
  to Nov rebound.
• Mexico Records set four years prior to 2008.
  Visitation down big, started before WHTI. Air
  14 of total Mexican inbound.
• Caribbean Visitation near 2000 record in 2008.
  Recent declines started prior to WHTI phase II.
• U.S. Outbound Travelers--generally down
• Canada Down most months for past 5 years.
  Record low level.
• Canada Auto day visitors down every month for 5
  yrs.
• Mexico Up over previous two years declines
  prior to WHTI pII.
• Caribbean Patterns nearly identical to Mexico
  recent big declines.

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Policy Challenges

• Pandemic Issues
• Travel Promotion Act
• Visa Issues
• Border Security IssuesWHTI and ESTA
• Market Barriers
• World Perceptions
• Indicators of Competitiveness
• Climate Change and Sustainability Issues

52
Travel Policy UpdateElectronic System for Travel
Authorization(ESTA)

• On June 3, 2008 - The Department of Homeland
  Security announced a new online system that is
  part of the Visa Waiver Program (VWP). There are
  35 countries eligible for the Visa Waiver
  Program.
• Nationals or citizens of Visa Waiver Program
  (VWP) countries are required to complete an
  approved ESTA prior to boarding a carrier to
  travel by air or sea to the United States. 
• Travelers under the VWP log on to the ESTA
  web-based system and complete an application
  online providing the biographical and eligibility
  information currently required on the paper I-94W
  form.
• ESTA implemented as a mandatory program effective
  January 20, 2010.ESTA Web site
  https//esta.cbp.dhs.gov.

53
Travel Policy UpdateElectronic System for Travel
Authorization(ESTA)

• An approved ESTA travel authorization is
• valid for up to two years or until the travelers
  passport expires, whichever comes first
• valid for multiple entries into the U.S. and
• not a guarantee of admissibility to the United
  States at a port of entry.  ESTA approval only
  authorizes a traveler to board a carrier for
  travel to the U.S. under the VWP.  In all cases,
  CBP officers make admissibility determinations at
  our ports of entry.

54
U.S.-China Memorandum of Understandingupdate

• Framework to permit group leisure travel from
  China to U.S.
• Needed because Chinese regulations restrict
  package tours to countries without a bi-lateral
  agreement, commonly known as Approved Destination
  Status. This MOU serves that purpose in opening
  these doors.
• U.S. travel destinations/companies able to
  organize and market package group leisure tours
  and market their brand.
• Open to 21 provinces now

55
Market Development Cooperator Program(M.D.C.P)

• MDCP awards are partnerships between ITA and
  non-profit industry groups that foster global
  competitiveness and enhance export capability.
• Competitive opportunity for innovative projects
  with a special emphasis on small and medium sized
  enterprises (SMEs).

• Whos Eligible?
• Trade associations
• State departments of trade
• Chambers of commerce
• Small business development centers
• Regional associations of trade and economic
  development
• Generally, private enterprises are not eligible,
  unless partnering.

Example Local travel and tourism businesses
with Convention and Visitors Bureau
HTTP//ITA.DOC.GOV/TD/MDCP
56
Market Development Cooperator Program(M.D.C.P)

• Fast Facts
• Industry groups pledge to pay minimum of
  two-thirds of project cost
• Cash match must at least equal the federal
  financial assistance then in-kind contributions
  can be used.
• Individual award limit of 500,000.
• Period does not exceed 3 years

• Example
• If you receive 100,000, you must put up 200,000
  in match.
• At least 100,000 of the 200,000 must be in
  cash, the rest may be in-kind contributions or
  cash.

HTTP//ITA.DOC.GOV/TD/MDCP