The Japanese outbound departures seem to have stabilized by the middle of April following the
plunge due to the Earthquake (Tohoku-Kanto Earthquake) in March. The overall impact on the consumer has been immense. Outbound departures hit the bottom much earlier than domestic travel because no fear existed regarding overseas travel this time. This is quite different from the situation following SARS as well as 9.11. Furthermore, business…
The Japanese outbound departures seem to have stabilized by the middle of April following the
plunge due to the Earthquake (Tohoku-Kanto Earthquake) in March.
The overall impact on the consumer has been immense. Outbound departures hit the bottom much earlier than domestic travel because no fear existed regarding overseas travel this time. This is quite different from the situation following SARS as well as 9.11. Furthermore, business travel appears to have already recovered.
The leisure market in Tokyo is at the very bottom currently, however, it is expected to see demand
start to come back in the latter half of May based on observations of previous crises. The decrease of international airline seat capacity in/out from Japan has only been about 10% since the quake. This is much smaller than the overall decrease in passenger demand including the huge drop in the number of foreign arrivals.
Recovery, however, will face several challenges in the longer term (6 months to a year) due to a hike of fuel surcharges, together with strong concerns over tightening of consumer spending deriving from a large fall of corporate profit and forthcoming tax increases. In the initial stage of its impact, the risks of the Japan Earthquake to the travel industry is considerably smaller than SARS or 9.11 and travel demand will recover within a relatively short time. However, it is not stable and may deteriorate. Therefore, the tourism industry, especially travel agencies, must take into consideration the risks of possible lowered travel demand together with reduced consumer spending in their management strategy.
The Japanese outbound travel market in the Kansai and Chubu area is fairly stable compared to Tokyo and these two markets will lead the market for the time being.
Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.
