Wednesday, January 22, 2014

Will the return of China flights be more than just seasonal?

Queensland Economy Watch has questioned a recent report in the Post that Cairns is on the cusp of a Chinese tourism boom: Chinese tourism boom for Cairns?

I posted some comments there related to Cairns Airport numbers and have since revisited the data. The currently posted historical data by the airport is presented differently from what I downloaded last July with a clear differentiation between domestic and international passengers.

This is a graph of international passenger traffic since 2003 which also correlates with CairnsWatch:


A simple trendline (blue) would appear almost terminal (sic). The 12 month rolling average less so although not showing any signs of a positive trend either. Apart from seasonal factors there have also been a series of 'one-off' (?) events which contribute to the inconsistency and make any trend analysis difficult. This is monthly "growth" compared to the previous year:


This is massively more volatile than the similar domestic graph previously posted. This makes it difficult to ascertain the impact of the direct flights by China Eastern. These commenced at the end of October 2012 (just as the eclipse was due) and subsequently suspended in August 2013.

There were to recommence in November in line with seasonal Chinese tourism but this was subsequently delayed and they have only recently recommenced on January 7th in time for new year. It can probably be presumed this delay may have been related to the recent tourism changes in China and downturn in Chinese arrivals: Chinese tourism turbulence

The introduction of the flights certainly correlated with a boost in the international passenger numbers around the eclipse and 2013 Chinese new year although didn't seem to do much to sustain total passenger numbers in subsequent months. Three direct flights a week is nowhere near what once came from Japan. Something to watch as the year progresses and also what impact the regulation of Chinese package tours may have.

Brisbane Airport updated numbers yesterday with some interesting comments: Mining slowdown leaves Brisbane Airport domestic traffic flat
Brisbane Airport reported 1.4 per cent passenger growth in 2013, led by a 4.8 per cent rise in international traffic but only a 0.6 per cent rise in domestic traffic.
Chinese passenger growth at the airport fell 1.6 per cent in November - the first fall since January 2013 - due to changes in laws regulating cheap group holidays. But Mr Newbold said a rebound to 8 per cent growth in Chinese passengers in December was an encouraging sign.
Note: The January 2013 decline reported here may have been related to the lunar new year falling in different months in consecutive years.
 
Meanwhile some brave souls have speculated that a dairy-driven economy could froth a strengthening $Kiwi exchange rate all the way to parity with the $AUD. Traffic across the Tasman could also be something to keep an eye on?

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