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High Fuel Costs, Strong Loonie Will Keep Americans At Home


Québec braces for weak tourist season

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May 15, 2008

The proliferation of new hotels, high fuel costs, a still-strong loonie and even the U.S. presidential elections are expected to translate into a tough summer for the tourism industry.

"There will be more rooms available at lower rates," William Brown, executive vice-president of the 76-member Hotel Association of Greater Montreal, said yesterday. "It will be a buyer's market from the consumers' point of view."

Tourism industry officials acknowledge the currency issue is expected to keep American visitors away while encouraging Canadians to cross into the U.S. to benefit from their buying power there.

Besides high dollar and gas prices, Philippe St-Pierre, communications officer for CAA Quebec, noted a passport still isn't needed to drive into the U.S.

And another issue is the presidential elections. "Past history shows there's a tendency, especially by corporate America, to be so involved in the politics that they don't hold conferences outside the states," Brown said.

Despite those factors, he said the hotel occupancy rate should remain where it has been since 2003 - around 67 per cent - but that it will be more people after the same piece of pie.

Charles Lapointe, president and chief executive of Tourisme Montréal, is still forecasting a 3-per-cent increase in tourists for 2008.

"It certainly won't be a banner year because of the economic circumstances, but we can still expect a bright year," he said. "We need to increase the number of tourists to maintain the level of occupancy."

In order to compensate for the anticipated reduction in American visitors, Tourisme Montréal yesterday announced a $20-million investment in innovative new marketing strategies aimed at such markets as Mexico, the U.K. and France.

The associate dean, graduate programs, at Concordia University's John Molson School of Business isn't optimistic about Montreal-area tourism this year.

"I don't think we'll do as well because there will be less travel to Montreal and less money spent here," Alan Hochstein predicted.

The veteran finance professor noted there's already a strong movement of Canadians going south of the border, where they can buy goods and services cheaper thanks to the dollar parity, while at the same time, Americans are staying home because Canada is no longer a bargain for them.

"We're also going to lose on the multiplier effect," Hochstein said of the spinoffs that restaurants and retailers benefit from when visitors flock to attend the numerous festivals and sporting events like the Canadian Grand Prix.

"There's no policy to undertake," he added. "We have to live with it."

canada.com

Québec braces for weak tourist season
Québec City / bonjourquebec.com



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