Glib thinking might hold that tumbling oil prices and a low Canadian dollar will spark a B.C. tourism renaissance.
The truth, however, is far more complicated.
Yes, the combination will make it cheaper for Americans to ski at Whistler or enjoy Vancouver’s many attractions.
“But the lion’s share of travellers in Canada are Canadians,” said David Ferguson, a senior associate with hotel industry data collector PKF Consulting Inc.
“If Canadians are concerned about keeping their jobs or keeping the income levels that they’ve historically been earning, that erodes consumer confidence.”
Weak confidence, he said, translates into fewer vacations and hotel stays.
Tourism Vancouver estimated that a record 8.94 million people visited the city in 2014, and it projects that even more visitors will come in 2015.
Its executives temper that optimism with concerns similar to Ferguson’s.
“Tourism hates insecurity,” Tourism Vancouver’s vice-president of leisure travel and digital marketing, Stephen Pearce, told Business in Vancouver.
“If people are feeling uncertain about their futures or if the dollar gets too low, they may decide not to travel at all.”
Tourism Vancouver’s statistics show that in the first 11 months of 2014 approximately 65% of all overnight visitors to Vancouver were Canadian; only 25% were American. British Columbians make up nearly half of all Canadian visitors to Vancouver.
However, figuring out the percentage of visitors who stay in hotels and therefore have a bigger economic impact is tricky.
International travellers punch above their weight when it comes to economic impact per traveller, Pearce said, because Canadians are more likely to stay with relatives than to pay for a hotel.
Hotel executives told BIV that they expect good and bad from depressed oil prices and a low Canadian dollar.
“We and everyone else will be concerned about the economic consequences that caused the Canadian dollar to fall,” said Rick Hoffman, Marriott International Inc.’s executive vice-president of mergers and acquisitions and business development.
His brand is set to become Canada’s largest full-service hotel chain, with 120 hotels, if its $168 million acquisition of Delta Hotels and Resorts from British Columbia Investment Management Corp. closes, as expected, in April.
“Many Canadian markets, including the ski resorts, ought to be very good for American visitors,” Hoffman said.
Coast Hotels CEO Robert Pratt agreed that there would be a mix of good and bad.
“The low dollar is good news for tourism across the country, particularly in those markets that are close to the U.S. border,” said Pratt, whose 40-hotel chain includes 20 locations in B.C.
“Victoria is the best example of improvement in the past few months, but we also saw some improvement in Vancouver.”
But demand for Coast’s five Alberta locations has weakened.
As for Coast hotels at ski resorts such as Whistler and Sun Peaks, Pratt said the biggest determinant of high occupancy is good ski weather.
Low snow levels at the start of the season caused those hotels to have slow starts, but business picked up once snow arrived.
The only part of B.C. that has really started to cool is Prince George, where there is more oil and gas activity, Pratt said. •
