The high-flying tourism sector is about to get its wings clipped, with operators facing the biggest downturn in decades, industry authorities warn.
Tourism New Zealand chief executive George Hickton visited Queenstown yesterday to brief tourism operators on the fallout from the current economic crisis.
During a whistle-stop tour of the country, Mr Hickton visited Auckland, Rotorua, Wellington, Christchurch and Queenstown.
He was giving industry representatives a "heads up" about the economic fallout.
"We have to prepare for tougher times," he said.
"Our industry is no more sheltered than others."
In September, arrivals from key markets were considerably down compared to last year.
United States figures dropped 16.4%, Australia fell 7.1%, United Kingdom slipped 9.4%, China fell 28.4% and Japan by 24.6%.
Next year was shaping up as being "more challenging", he said.
The slump in tourism numbers could lead to fewer seasonal jobs on offer, cheaper prices, and an increasing reliance on the Australian and domestic markets, he said.
Tourism Industry Association chief executive Tim Cossar said "there is a sense of doom and gloom at the moment".
With operators reporting a decline in tourist numbers, the industry was going through its worst period "in a long, long time".
The situation was likely to worsen in April, the traditional end of the main summer season, where bookings made eight months previously could be cancelled as the economic crisis began to bite, he said.
"Come April there could be a dark hole."
Millbrook general manager David Onions said the resort had noticed a recent downturn in bookings.
While order books until 2010 were solid, summer bookings were down between 10% and 15% compared to last year, he said.
"There is a question mark on how we will fare from April though to winter."
Destination Queenstown acting chief executive Graham Budd said the industry was likely to see a continual decline in tourism numbers compared to last year.
"Businesses will face tough decisions in the future as they try to ride this out," he said.
Real Journeys chief executive Dave Hawkey said tourism numbers said numbers were already down 10% to 20% on last season.
"That is a huge drop," he said.
In order to remain competitive the company was reviewing its costs, including seasonal staffing numbers.
"I don't think the industry has ever faced anything like this . . . this is not Sars, 9/11 or birdflu, this is a lot more serious," he said.
Tourism contributes close to 10% of gross domestic product.
It directly and indirectly employs one in 10 New Zealanders.
Tourism is a $50 million a day industry- $24 million in foreign exchange earnings and $26 million in domestic tourism.
For the year ending March 2007, tourism expenditure accounted for $20.1 billion, representing 18.3% of New Zealand's foreign exchange earnings.
More than 85% of tourism businesses are small to medium businesses.
