Sept. 11 changed the landscape, but airlines have been in decline for some time
Whistler has weathered the turbulence in the airline industry this season but 2002 will still be a bumpy ride for tourist spots everywhere.
Recent events, particularly in the Canadian airline industry, have highlighted the close relationship between air travel and the tourism industry.
Both are intimately interconnected and changes in one are felt within the other.
"The airline industry is the lifeline to tourism," said Barrett Fisher, vice-president of marketing strategy and business development for Tourism Whistler.
"We absolutely rely on it because that's how our customers get here. It's very important that we work hand in glove (with the industry)."
The importance of this symbiotic relationship with destination resorts was highlighted about seven years ago in Aspen.
During the 1994/95 ski season, Continental Airlines decided it would no longer fly into Denver, the closest international airport to Aspen. With that decision, the resort immediately lost 35 per cent of its airline seats in one fell swoop.
"It was the best snow year in years throughout Colorado and our skier days dropped seven per cent," said Bill Tomcich, president of StayAspenSnowmass.
Tomcich's scenario, which he recalled during a workshop at last week's Mountain Travel Symposium, represents how closely a healthy air industry and a healthy resort economy are tied together.
During most of the ’90s, the airline industry was enjoying a fairly prosperous time. Air travel increased rapidly and profit levels were at a record high.
But even before the terrorist attacks on Sept. 11, the industry was in a decline. Then 9/11 dealt a heavy blow.
Total tourism expenditures in Canada have dropped 6.3 per cent since 2000, according to a recent Statistics Canada report.
Airlines are currently losing between $6 million and $9 million every day and experts believe there won't be a positive turnaround for at least the next 14 months.
There is a perception among tour operators that passengers don't seem as interested or eager to fly, especially longer flights.
During the final four months of 2001, passenger traffic at Vancouver International Airport was down 15 per cent.
All major carriers everywhere have been cutting back significantly both in frequency of flights and number of planes in the air.
So where does that leave a resort destination spot like Whistler?
If this year's numbers are anything to go by, it would appear as though Whistler is weathering the storm of the airline slump quite well.
"We're now anticipating that our season will be flat compared to last year," said Fisher.
"And, on top of that, we've had record breaking months for February and March – March being five per cent up from the previous year, which was a record year."
To achieve high visitor numbers in the face of such huge adversity, Tourism Whistler had to shift gears in the fall in order to capture the market that came to the resort this season.
They focused their marketing campaigns primarily on regional markets in B.C. and Washington State.
From Nov. 1 to March 31, the B.C. market was up seven per cent compared to last year, and Washington State was up 32 per cent.
This was the target rubber tire market that was essential for business in Whistler this season.
And while many of the visitors this year came via car or bus, still another portion flew.
"We have very good non-top direct air access from California, Ontario and from Chicago," said Fisher.
The Ontario market was up 14 per cent and California was flat compared to last year, a banner year.
"California, even though it's a fly market, it's considered within the west coast corridor," said Fisher.
"It's a shorter flight. It's a perceived safer flight. Similarly, the Toronto to Vancouver flight is within Canadian boundaries and so is perceived as being a safer route."
Mexican visitors saw the largest increase, up 73 per cent from last year.
Those tourists may have chosen Whistler because flights do not land on American soil and therefore are perceived to be safer, said Fisher.
The markets that saw a decline were some of the international ones, who are also suffering economically, specifically Japan, down by 40 per cent, and Germany, down by seven per cent.
But the long-haul visitor was not the main target for the 2001/2002 winter season.
While many chose not to fly, the perceived danger of longer flights was not the only thing keeping potential airline customers on the ground. Carriers also scaled back on the sheer number of flights they were once offering.
Sheila Remes, regional manager marketing and planning with United Airlines, said United grounded 100 flights in the fall.
Last summer United had 312 flights out of Denver. By November the airline had grounded about one-third of its planes and operated 210 out of Denver.
This summer there will be 272.
Fisher calls this a chicken and egg effect.
"When there is a decline in demand from the customer, then the airlines react by having a decline in frequency," she said.
"And it's in their better interest to in fact increase that frequency once the demand starts to pick up again."
Travelling passengers may think the airline industry is healthy because the load factors, meaning the number of people on the planes, are at the same levels as last year, if not higher, so the planes are relatively full. But the average yields are down 10 to 15 per cent because airlines are not flying as many flights as they once were.
"Where we have seen declines as a result of Sept. 11 would be for example, Dallas. We also saw the cancellation of flights out of Florida," said Fisher.
"There is a non-stop direct flight out of New York but not at the frequency level that we'd like to see based on the long-term opportunity in the market," said Fisher.
Airline changes in Canada were being felt in the tourism sector even before Sept. 11, beginning with the Air Canada/Canadian merger.
Then in December Canada lost another of its major airlines. As Canada 3000 collapsed, Canada was left with only one major airline carrier in the country.
This virtual monopoly on the Canadian air industry is a major concern for tour operators here.
"We're concerned about the fact that there's not much competition in the cross Canada airline field," said Mary Mahon Jones, the executive vice-president and CEO of the B.C. Council of Tourism Associations.
"Air Canada definitely has a dominant position in the field now that we don't have Canada 3000 running."
This week Jones is in Ottawa lobbying the federal government to protect tourism by protecting the airline industry.
"We need government to look at air transport as an essential infrastructure that supports the tourism industry," she said.
There is currently another thorn in the side of the Canadian air industry in the form of a $24 "security charge" that came down in the December federal budget.
"We're talking about a tourist who is very price sensitive and we think that's going to have a really big impact, particularly on short-haul travel," said Jones.
Because customers are not eager to fly, they are also not interested in paying exorbitant amounts of money for a ticket – any added surcharge will only serve to dissuade an already fickle customer.
Remes with United Airlines said customers have been trained to wait until airlines panic and then drop their ticket prices.
But it costs a lot of money to get a plane into the air and the industry cannot sustain itself on cheap tickets.
Historically the industry is one that operates with very high costs and low profits.
"I don't see (cheaper fares) happening just because of the market pressures," said Kent Myers, president of Resort Transportation Consulting and moderator at the Mountain Travel Symposium.
"These are extraordinary times under extraordinary conditions."
The symposium brought together about 800 tour operators and industry analysts in North America to discuss, among other things, the effects of the airline challenges on resort tourism.
This was the 27 th year of the symposium.
