A CENTRAL PILLAR OF LEOPARD COACHLINES’ SUCCESS HAS BEEN HARNESSING THE THREE MILLION INTERNATIONAL VISITORS’ AVERAGE LENGTH OF STAY OF 18 DAYS. BUT WITH BORDERS CLOSED AND DOMESTIC TOURISM NOW THE NEW FOCUS, BRENT EARLY ISN’T BUYING IT.
Leopard Coachlines owner, Brent Early, saw the effects of COVID-19 before a lot of Kiwis did. Or he, at least, understood the ramifications better than most.
A day after Singapore confirmed its first two coronavirus-related deaths, the country said it would close its borders to short-term visitors and some foreign labourers from March 22 to help limit the spread of the disease.
Such a decree halted Europeans flying into the island nation, also affecting how many flew to our little island nation in the Pacific Ocean.
“So, we started seeing business drop off quite a bit earlier than the announcement of that closure,” Brent says.
And as a result of the business model’s reliance on international tourism, Brent and the Leopard team began preparing for the worst.
“A lot of Kiwis probably didn’t understand how bad it was until we went into lockdown officially. We knew it was coming, and started to make plans as best we could well ahead of lockdown.”
“We went through a first round of redundancies and a second round once we were in the middle of lockdown.”
“One hundred staff in total have been made redundant, making Brent “sick to my stomach.”
Staff members of 10, 15 and 20 years were unfortunately let go.
“One guy we had let go was with us for nearly 27 years – the longest serving staff member. That was incredibly devastating for him and us.”
However, with most countries’ borders still closed to international visitors, like New Zealand’s still is, he’s unable to shake the feeling that domestic tourism isn’t this country’s saviour.
“Obviously, we’ll keep in touch with our clients and market ourselves for this wonderfully new domestic business the government believes is out there. But it’s a load of rubbish in my view”.
“We will never ever replace the volume of three million new international visitors who want to see everything in New Zealand”.
“Compare that particular traveller to your average Kiwi holidaymaker, exploring their own country. How many will do that each year? One million in a good scenario?”
“People are out of work, and if they’re lucky enough to have enough money to travel, they tend to only visit one destination, like Rotorua and Queenstown once, for example so, that doesn’t replace international tourism. The government, I believe, has been a bit mischievous telling people that it would.”
The most daunting part, he says, is the not knowing. Not knowing when an Australian bubble may come about – even if it were to help only a little – and not knowing how to prepare for the long-term future.
“For right now, the only viable method of survival is to just hunker down”, Brent says, “culling as many business costs as possible”.
“We were reasonably strong in the corporate stuff in Auckland, so I’m hoping a bit of that might come back”.
“We’ve also partnered with one of our inbound tour operator clients who’s trying to generate some domestic business, so we’ve got a deal with them to try and market into that”.
“Obviously, we’ll be chasing every bit of domestic work we can but it’s really night and day comparing the domestic and international tourism market.”
Keenly listening to the Labour Government’s May 2020 Budget announcement, Brent and others within the tourism industry were left feeling disappointed. The $400 million tourism rescue package “was a non-event for most of us”, especially as, in 2019, tourism injected $112 million a day into our economy.
As part of the rescue package a tourism transitions programme would advise and support businesses turning to the domestic and Australian market, hibernating, or considering other options. A tourism recovery ministers group would be set up, with members set to include the ministers of tourism, finance, Māori development and conservation. A public-private taskforce would help shape the future of tourism in New Zealand, consisting of cross-government and tourism sector representatives.
But Brent believes it’s the government’s misunderstanding of the industry that has shaped these initiatives. “I don’t think they really understood it, or handed the portfolio to anyone who was really that interested or motivated by it”.
“The problem they face, I think, is that they haven’t been cognisant of the industry’s true nitty gritty stuff – like relationships with clients and overseas stakeholders, and all the IP. A lot of people are hugely knowledgeable about how things are done – doing deals and connecting people together”.
“Meaning if they don’t support the industry in some meaningful way as to allow international visitors back, a lot of knowledge and relationships will disappear, and the recovery will much longer and much slower.”
With the all too important general election coming up in September, Brent would like to see whatever government is in power give the industry the backing and leadership it clearly deserves.
“What we’d like is someone a bit more serious to take tourism on and give us a bit more than the equivalent of four days earning that they did give us to make the industry survive.”
But what about the average Kiwi? How can they help fill the hole left by the disappearance of three million tourists? Unfortunately, not a lot. Sure, transporting sports groups, social clubs, corporate type events, and conferences will be helpful.
“We’re certainly keen for anything that is going.” But it’s unlikely the public can contribute in any financially viable way. I just think that the ‘reimagining of tourism’ towards the domestic market is just a project to keep some people busy and perhaps make the ‘powers at be’ feel good”.
“It won’t replace that prior earnings or the volume, because Kiwis aren’t doing the same sort of holidays our international visitors were. Queenstown had a couple of good days over Queen’s Birthday weekend and I’m sure they’ll have another couple of good weeks during the school holidays and snow season. But beyond that, they’re not going to have the volume to survive. And nor are we. You can’t survive on the odd good weekend. So, I think reimagining is a bit of a pipe dream”.
“Don’t get me wrong, it’s a great opportunity for Kiwis to see their country, but it’s not the replacement. A million Kiwis might be able afford to stay in a hotel and eat out and look around the country, but we need 3 million every year to come in.”
Written by James Paul for BCA News, Circular July 2020