Australians are being urged to revive the tourism industry by taking a
holiday at home this year as borders remain close, but the Australian
Tourism Export Council (ATEC) warns that a domestic tourism uptick will
not offer a "simple fix" for tourism businesses devastated by the
impacts of Covid-19 pandemic.
“While the government is doing the right thing in urging Australians
to spend their holiday savings at home this year, the idea that it can
somehow replace the income the industry derives from international
visitors is unrealistic,” ATEC managing director Peter Shelley said.
“Domestic holidays can and will help many Australian tourism
businesses, particularly those set up specifically for local visitors,
but for those who have strongly invested in the inbound market or who
have a business set up purely to service the international visitors,
domestic travellers just won’t generate the same income," he stated.
ATEC research has shown that a third of tourism businesses will not
benefit from the domestic tourism market, with more than half of
businesses expected to shutter within six months without international
Said Mr Shelley: “This is hardly surprising given the average spend
of an international visitor is A$5,211 (US$3,608). It’s just not
feasible to think most Australians would spend that amount of money on a
domestic holiday in order to make up a A$45 billion shortfall."
Furthermore, expectations on the travel budget capacity of the
domestic market are unrealistic given diminished consumer confidence,
perceived economic insecurity and disrupted leave entitlements
experienced by many Australians this year, he added.
“We have already seen some tourism products adjusting their pricing
to encourage locals to get involved, but this price reduction is often
being massively and unsustainably subsidised and not delivering any real
profits to the business.
“Many other tourism businesses are just not able to ‘pivot’ to the
domestic market. They are either exclusively focused on international
visitors - like inbound tour operators who build itineraries for
international travellers and support and service them during their stay,
or tourism businesses which have invested in designing products to
appeal to particular international markets.
Mr Shelley stressed the importance of preserving the export tourism
businesses, which, having having achieved double-digit growth for much
of the last decade, will form the foundation of the rebuilding process
when international borders reopen.
“In truth, there will be very few export tourism businesses who will
benefit significantly from a domestic uptick and they definitely won’t
be looking at the level of revenue our inbound sector has delivered in
“While we encourage Australians to get out and see Australia, we need
to recognise there are some valuable and otherwise viable businesses
which will need government support in order to make it through this long
period of hibernation."
ATEC is currently in discussion with the industry and government
agencies to negotiate an extension of industry support, according to Mr