Summary:
Fewer domestic overnights, robust international spend, and job
declines
July was a challenging month for the West Coast's tourism sector. Despite a slight rise in domestic card spend, commercial accommodation declined, with a notable drop in both guest nights and occupancy. This was driven by a decrease in both guest arrivals and average stay length. However, international card spend showed strong growth. Tourism-related employment for the month saw a decline.
Spending outpaces guest nights, hinting at day trips or average
spend
An increase in total domestic card spend (+1% YoY) when compared with the domestic guest night decline of -13% YoY suggested that either the relative average spend had increased, or the prevalence of day trip visitation. The international card spend increase of +8% YoY, when contrasted with a +4% YoY rise in international guest nights, also suggested a lesser increase in average spend, or the prevalence of day trip visitation.
Domestic visitors self-cater, while internationals dine out more
When segmenting card spend by product type, international card spend grew for all categories except for recreation (-2% YoY), whilst domestic card spend by product produced mixed results. Food and beverage serving showed further growth for the international market (+14% YoY) and a greater contraction for the domestic market (-12% YoY) when compared to food and beverage retail (domestic: -2% YoY, international: +4% YoY). This observation suggested a continuing preference toward self-catering for domestic visitors, while international visitors appeared to prefer dining out.
Domestic spending edges up, supported by West Coast support
Domestic card spend increased fractionally (+1% YoY) in July, which was on par with the Marlborough and Hurunui RTO regions (both +1% YoY), and well above the national average of -5% YoY. West Coast locals contributed to the positive spend growth (+6% YoY), alongside other notable markets: Tasman (+5% YoY), Nelson (+4% YoY), and Marlborough (+13% YoY).
Aussie and UK spending climb in July, while US declines
International card spend showed strong growth (+8% YoY) in July, equal to Canterbury (+8% YoY). The Australian market grew strongly by +22% YoY, taking the top position for distribution of total international market spend. This was congruent with the off-season trend of 2023 and 2024. Other notable market growth included the UK, which jumped by +26% YoY. The US market declined by -11% YoY, a result that contrasted with significant growth in most other RTO regions.
Domestic slowdown causes occupancy drop and shorter average
stays
Commercial accommodation declined overall for the West Coast region in July, with occupancy falling by -2%pt. YoY and guest nights down by -9% YoY. The drop in guest nights was driven by declines in both the average stay length (-5% YoY) and guest arrivals (-3% YoY), while the fall in occupancy was further exacerbated by an increase in available stay units (+4% YoY). A comparison of the market mix, which showed international guest nights were stable (0% YoY) while domestic guest nights fell by -13% YoY, indicated that the decrease in average stay length and arrivals was primarily attributable to domestic travellers.
Lodges and boutique spots double, propelled by international visitors
When segmented by accommodation type, guest nights decreased across nearly all categories (holiday parks and campgrounds: -14% YoY, smaller motels and apartments: -7% YoY, hotels: -8% YoY, backpackers: -13% YoY, and large motels and apartments: -18% YoY), with the exception of lodges and boutique accommodation, which doubled in guest nights (+100% YoY) relative to July 2024. This growth was comprised of a +58% YoY increase in domestic guest nights and an almighty shift (+450% YoY) in international guest nights. This highlighted its strength as an emerging market, as shown in the quarter-end figures (+357% YoY international guest nights vs. +32% YoY domestic guest nights).
Guest declines persist despite pockets of international growth
Guest nights decreased across all TAs in July: the Westland District was down by -5% YoY, the Buller District by -13% YoY, and the Grey District by -10% YoY. These declines occurred despite an increase in international guest nights in the Buller (+2% YoY) and Grey (+9% YoY) Districts. The Westland District declined in both international (-3% YoY) and domestic (-7% YoY) guest nights.
Tourism job dip in July, driven by food and accommodation
Tourism-related employment decreased by -3% YoY overall in July, a result that aligned with the Mackenzie region (-3% YoY) but trailed the stable growth seen in the national average (+1% YoY). This decrease was driven primarily by the two largest tourism-related employment industries, food and beverage services (-3% YoY) and accommodation (-8% YoY), and was mitigated somewhat by recreation (+24% YoY) and travel and tour services (+20% YoY).
Employment and accommodation decline, with minor stability in
places
Contractions in tourism employment were noted in the Westland (-4% YoY) and Buller (-4% YoY) districts, whilst the Grey district remained stable at 0% YoY. Food and beverage services declined by -7% YoY in the Westland District, whilst remaining stable in both the Buller and Grey districts (0% YoY). A decline in accommodation was reported in all three districts (Westland District: -6% YoY, Grey District: -10% YoY, and Buller District: -8% YoY).