The

1
The Impact of September 11, 2001 On The Travel
And Tourism Industry
N i c h o l s
G i l s t r a p
2
Travel Activity

• Airlines -- 27 occupancy over past few days
• ASTA -- agencies reporting 40-50 cancellations
• International An individual Japanese Travel
  Bureau had 8,000 individual and group tours
  cancel for just September

Travel Advance, Week of September 17, 2001
3
Security Tightens At U.S. Borders

• The U.S. has sharply intensified inspections and
  surveillance along its Canadian and Mexico
  borders, reshaping the face of two of the most
  open international frontiers, maybe for years to
  come.
• Waits up to 15 hours have been reported at border
  crossings.

The Wall Street Journal and New York Times,
Monday, September 24, 2001
4
Outlook For U.S. Hotels

• PricewaterhouseCoopers forecasts
• RevPAR for 2001 will decline between 3.5 and
  5.0
• Decline 7 - 10 in the second half of 2001
• Industry will still be profitable by 18-20
  billion overall
• Smith Travel Research predicts
• 8 per month decrease in occupancy vs. last year
• Decline in 2 per month in rates

Travel Advance, Week of September 17, 2001
5
Hotel Executives And Labor Unions Prepare For
Layoffs
Hotel executives and their industrys labor
unions are preparing for an unprecedented wave of
layoffs and a domino-like economic impact in the
wake of the September 11 terror attacks.

• Executives will be calling for
• A wide package of tax aid
• Small-business loans
• The formation of a presidential council and
  scheduling of tourism summit

The Wall Street Journal, Monday, September 24,
2001
6
Business Travel Continues Decline
A survey of corporate travel professionals, by
the National Business Travel Association, says
that only 19 said they were going ahead with
business travel plans. Many companies are
choosing videoconferencing and car trips rather
than air travel. - DallasMorningNews.com
Travel Advance Volume, XI, Number 184, Thursday,
September 20, 2001
7
ASTA Asks For Federal Assistance
The American Society of Travel Agents wants 4
billion in federal assistance in the form of
grants and no-interest loans to help travel
agencies pinched by the pullback in travel.
Travel Advance, Volume XI, Number 186, Monday,
September 24, 2001
8
Destinations Struggle
The normally crowed restaurants and bars in New
Orleans French Quarter are drawing few tourists
these days. Bourbon Street hasnt been packed.
And the Hilton New Orleans Riverside has lost
more than 1 million from cancellations.
Citywide losses are estimated at 37 million.
The New York Times, Monday, September 24, 2001
9
International Visitors To Stay Away In Droves
Foreign travelers to the U.S. have largely
disappeared since the terrorist attacks and are
likely to stay away in droves in the near future.
Travel experts say Europeans are more likely to
resume travel to the U.S. But few people are
expecting international tourism to bounce back as
quickly as it did after the Persian Gulf War in
1991. - LosAngelesTimes.com
Travel Advance Volume, XI, Number 184, Thursday,
September 20, 2001
10
Uneasy Travelers Put Holiday Plans On Hold

• Two months before Thanksgiving--one of the
  busiest holiday travel weekends of the year --
  many would be travelers are planning to stay home
  or drive to see loved ones instead of flying or
  taking trains.
• Some travel agents have seen the first large wave
  of holiday-season cancellations

The holiday travel season has come to a
standstill. -Mary Peters President of Friendly
Travel in Alexandria, VA.
USA Today and The Washington Post, Monday,
September 24, 2001
11
Hawaii Faces Economic Crisis

• Hawaii faces its greatest economic crisis ever,
  said Governor Ben Cayetano. As the tourist
  industry goes, so will the rest of Hawaiis
  economy. The state is considering such measures
  as tax deferrals, 99 travel packages and
  Japan-oriented telethons to help businesses
  survive the economic fallout.

Honolulu Advertiser.com/Business, Monday,
September 24, 2001
12
Strategies To Lure Back Jittery Travelers
States and communities that depend on tourism and
face a plunge in visitors are moving to shore up
their economies with recovery plans.

• Governors of Florida and Hawaii, two of the
  nations most tourism-reliant states, are calling
  for special legislative sessions in October to
  consider ways to bolster their tourism
  industries.
• Virginias Governor created a Post-Attack
  Economic Response Task Force, which is expected
  to make recommendation with six weeks on how to
  aid affected businesses.

The Wall Street Journal, Monday, September 24,
2001
13
Pockets OfSuccess
Officials in the Ozark Mountains vacation resort
of Branson, Missouri, say they have not seen a
drop in tourism, in part because most visitors
arrive by land, not by air. Branson draws about
7 million visitors a year, about 85 of whom
drive in.
Knight Ridder/Tribune News, Monday, September 24,
2001
14
Factors Contributing To Downturn

• Airline disruption and fear of flying.
  U.S. markets that are
  fly-in destinations, as opposed to regional
  drive-in markets, are most susceptible.
• A down economy. The close ties
  between the general health of the economy and the
  hotel industry suggests that if the economy slows
  down further, then so will hotels.

15
Impacts Will Vary

• Timing of the incident will affect markets
  differently. Memories of Sept 11 might linger
  for 4-5 months, so some industry experts predict
  winter season markets like Arizona and Florida
  will be hurt the most, especially if recession
  results.

16
TIA Plan To Restore Confidence In Travel
The Travel Industry Association (TIA) has laid
out a two-pronged plan aimed at ensuring travel
safety and rebuilding confidence in traveling to
and within the United States.

• The plan calls for industry support of airports
  and airline security measures, and a campaign to
  publicize the new security measures.
• An industry communications campaign will be
  developed to target U.S. and International
  travelers in key generating markets.

Travel Advance, Volume XI, Number 186, Monday,
September 24, 2001
17
Uneasy Travelers Put Holiday Plans On Hold
The Good News For Those That Still Travel?
Prices may go down as the holiday nears instead
of risings as they often do.
USA Today and The Washington Post, Monday,
September 24, 2001