Australian in flux helps hotels

Queenstown hotels weathered the storms of global recession and swine flu by capitalising on the "massive influx" of 106,000 more Australians last year, according to the New Zealand Hotel Council (NZHC), which met in the resort this week.

Transtasman visitors to the resort increased by 10% last year, compared to 2008. More New Zealanders travelled to domestic destinations, including Queenstown, instead of overseas, which also offset declines in British and Asian markets.

NZHC chairwoman Jennie Langley, of Wellington, and Covec Ltd consulting economist Shane Vuletich, of Auckland, delivered the council's annual operating survey to about 40 Queenstown tourism operators on Wednesday.

Mr Vuletich said 2008 to 2009 had been a challenging time due to the global recession and swine flu, "but the worst does seem to be over" and there was a "slow, gradual return to normality".

The major market shift was the massive influx of Australians and the only resilient long-haul market was Germany, he said.

"Queenstown came out of [the recession] quicker than everyone else and was the logical destination for Australians and they came in hordes from mid-2009."

The big losses were in the Asian markets, even before swine flu, as they were always responsive to economics and had turned down group tours. Japanese and South Korean markets would continue to be problematic. China was offsetting some of the effects but it was volatile, he said.

Ms Langley said new thinking was required to determine what regions of China to target, the differing demographics and where they were likely to go in New Zealand.

"The conference and incentive market took a big hit in 2009 but anecdotally seems to be returning to normal," Mr Vuletich said.

"I think we're going to see cutting back for some time to come."

The survey recorded a "strong and inevitable shift" in online business transactions by holidaymakers, with hotels and businesses responding to consumer demand, Mr Vuletich said.

Ms Langley said national hoteliers were expecting a 12- to 18-month lag of lower profits, although "broadly cautious optimism" had been gauged in their business outlook.

The Rugby World Cup 2011 was firmly in Queenstown members' sights, she said.

"The issue is how to maximise the Rugby World Cup going on, not as just a blip."