One of the major stories that unraveled last month was news that
the airline industry is in dire straits. But they are not the only ones.
The terrorist attacks on the US have impacted a number of related
industries as well - notably the nation's tourism and leisure industry,
which reportedly brings in $582 billion annually (Los Angeles
Times, September 18).
Across the country, there were grim reports that the temporary grounding
of airlines and the subsequent fear of air travel is creating a massive
domino effect that is taking its toll on hotels, conventions,
restaurants, theme parks, cruise ships, travel agencies, and
casinos.
Hotels earned the most attention, and were described by some as having
the appearance of a ghost town. Although normally booked at 75% to 100%
capacity during the fall season, hotels were reported to have fallen to
just 20% to 30% full in a number of major metropolitan cities. A hotel
consultant from PKF Consulting assessed, "(Hotels) are going to get
hammered to death. The next three months - the only way to describe them
- are going to be bloody" (Houston Chronicle, September 18).
In New Orleans, a hotel executive explained, "Our market is 80%
tour-group driven, and 99% of the group businesses fly in. So the first
step for our customers is usually getting on a plane, and if they're not
flying for whatever reason, our bookings are adversely affected" (Times
Picayune, September 18).
Many reports noted that the pain of the hotel industry would be felt
harshly since the economy had been slowing even before the attacks. The
Sacramento Bee (September 16) noted, "Even before the terrorist attacks,
PKF was projecting a 3.5% decline in hotel revenue this year, the worst
in 40 years."
Hotels were further impacted by the cancellation of conventions across
the country. Coverage also noted that even for those conventions that
didn't cancel, there was no guarantee that attendance would be as high
as in previous years.
Several articles reported on the efforts made by the tourism industries
to keep attendance levels up in light of the attacks. The most
frequently discussed measure was to target nearby customers who would be
able to drive to their destinations rather than fly. Newspapers in
Florida reported that the state was seriously considering a push to "get
Floridians to visit Florida" (The Orlando Sentinel, September 18).
The prognosis for the tourism industry over the next three months is
awful, but coverage could not say what it would be like in the longer
term. The media reported a consensus among hotel and tourism industry
executives that they have never encountered anything like this
before.
The complete drop-off in tourist-related activity was said to be
unprecedented. A few analysts compared the Gulf War with the present
situation, though this time the attacks occurred on US soil.
While the situation feels bleak, the only silver lining was occasional
reports that bargains would soon spring up that might tempt Americans to
travel, or predictions that Americans would travel out of defiance and
patriotism. But these reports appeared infrequently, suggesting that the
tourism industry is in for a very rough ride.
- Evaluation and analysis by CARMA International. Media Watch can be
found at www.carma.com.
