Uncertainty in 2023 Hawaii Travel Forecast Emerges

Finding Light In Hawaii Travel’s Bleak Outlook For Summer

As US visitors and spending surpass all prior records, there’s still a huge cloud hanging over Hawaii travel’s horizon that is worth noting, and that might work to visitors’ advantage. While February hotel data remained promising and unrelenting, we see significant softening in demand ahead this summer and more, which could bring hotel, rental car and even prices back down while airfare continues to rise.

Looking back quickly to the last month for which we have data (February 2023),  hotel revenue was up an additional 17% compared with 2022, which was already up significantly from the prior two years. But it comes with 6% less demand on average over 2019. That is based on an average daily rate of $387 before taxes and fees. This is per the state’s February Hawaii Hotel Performance Report, attached below. The HTA report covers over 47k rooms or 86% of all 20+ room properties statewide. Vacation rentals aren’t included in this report.

  • Maui: $655 average nightly rate – a whopping 50% increase from 2019, but occupancy is down 9%. Wailea averaged $1,004 nightly, up 55% from 2019, but occupancy was down 25%.
  • Kauai:$418 average, up 38% from 2019.
  • Big Island: $432 average, up 52% from 2019.
  • Oahu/Honolulu: $266 average, up 13% from 2019.

Lack of forward Hawaii hotel bookings bears scrutiny.

Even while February showed great promise, and a two-month result that was even better with a nearly 30% increase in numbers compared with last year, there were already signs of big trouble on the horizon for Hawaii that could open deals for visitors.

Here are the indications:

  1. There was less than a stellar Hawaii travel performance during the holiday period of December.
  2. The booking window for Hawaii travel has contracted substantially. In other words, visitors are no longer committing to Hawaii during traditional high-travel, high-spending periods where they normally book from months up to a year in advance.

You have longed blessed Hawaii with predictable visitor behavior. One could also anticipate that the state would reach sold-out conditions at high rates for peak periods of summer and other holidays.

A bust summer in Hawaii?

The industry is still hoping that in the next month, they will see indications that the demand for Hawaii travel will continue through summer and beyond. But if not, this will be a bust summer here in the islands. The coconut wireless (word on the street in Hawaii) is that advance bookings for traditionally stellar July are currently off by up to one-third.

In looking throughout the state this morning, we couldn’t easily find one hotel that was sold out for the week of July 1-8, which is typically one of the peak weeks of the year, and has traditionally sold out well in advance.

Where are Hawaii visitors going instead?

Europe especially will benefit from this change. After being on hold for what seemed like a Covid eternity, US visitors to Europe are growing by astronomical numbers. So much so that some places have issued warnings, such as to avoid some of the most popular destinations in Italy and elsewhere during the peak of summer 2023.

Not only that. Hawaii has now equaled or eclipsed the cost of a European vacation, something that has frankly never happened before.

The reversal in travel booking order has hurt Hawaii’s numbers.

In the past, visitors booked their Hawaii airfare first. But that’s no longer the case. Instead, Hawaii-bound travelers are getting their first dose of sticker shock when looking at Hawaii accommodations and Hawaii car rentals. Perhaps at that point, the world atlas emerges, and other options become more attractive. Airlines don’t even have a chance to sell their overpriced wares. And as we said the other day, the airfares are, for the most part, also ridiculously overpriced to Hawaii. Your editors are finding the cost of airfare to get out of Hawaii this summer so expensive that we are just saying what our commenters have called” a hard no.”

For those seeking tropical destinations like Hawaii, there are many other options globally, including arguably less costly, nearby Mexico and the Caribbean.

The situation was confirmed by, among other people, Jerry Gibson, BOH editors’ long-time friend and current president of the Hawaii Hotel Alliance. He indicated that the entire Hawaii marketing mess has also made it difficult for the state’s awful HTA and its marketing partners to compete globally. Jerry said, “It’s extremely important for us to have a good summer for all of us on every island. Maybe we are getting a little worried early because the booking window is a little shorter, but it’s not shaping up like we were hoping for.”

Some of the big issues looming include the following.

Trying to figure out what will occur next in Hawaii travel is challenging in still uncertain times.

  1. People have already revenge traveled. How much more is left?
  2. The concept of throwing caution to the wind and paying any amount has prevailed. But can that continue too?
  3. Inordinately high Hawaii prices, taxes, and fees. You see that hotel rates are up 50%, and that started with a base that was already very high. The enormity of taxes and fees add insult to injury.
  4. Car rentals also went up by about 50%.
  5. Unknown prospects for the US economy. That always remains a concern for discretionary travel such as Hawaii.
  6. Too high airfares exacerbated by fuel prices.
  7. Availability and cost of labor in Hawaii and throughout travel. It isn’t improving.
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76 thoughts on “Finding Light In Hawaii Travel’s Bleak Outlook For Summer”

    1. William- residents Do want you to visit. Our livelihood depends on it and the last few years have been Brutal for local families. The government here doesn’t reflect everyone’s wishes. 🙁 I hope prices come down so people want to come here again.

      1. You need to go to your County council meetings to have your voice heard. On Maui, there are always different meetings on different subjects going on. Not enough supporters of the economy are speaking out. Here is the website where you can check them out and try to attend and/or testify, either in person or online.

        mauicounty.legistar.com/Calendar.aspx

        I’m sure there is a similar site for whatever county you live in.

      1. Not happening anymore, they stopped marketing. In fact, they call it “tourism management” now. When is the last time you saw a splashy marketing campaign, put out by the tourism authority? The last thing I heard from them is “We have enough tourists, we don’t need to advertise for more”.

  1. Yes .. I love California ..and the people who love to a different colored state.. since California is a beautiful Blue Color … There is always Texas , Florida , Tennessee.. and enjoy the red color 😉

  2. We have been going to Hawaii every year since 2017. Went to look into our next trip for May and noticed a significant increase in price compared to the same trip over the past years. So…we thought ‘what about Europe’? We are going to France in May and the cost is similar to what we used to spend for Hawaii if not less. We’ll return to Hawaii I’m sure once/if the prices stabilize. We love Hawaii!

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    1. Enjoy France. Hope you are going to the South of France. I lived there for 12 years and enjoyed it! Go “upcountry” for good food!

  3. As a Hawaii visitor on the mainland. I can tell you that the loudest news we hear is Stay Away. So who is surprised. We have traveled at least once a year for 12 years. We stay in Waikiki and eat at all the restaurants and shop. We visit museums and other cultural places and events. After watching this all unfold from afar, next time I wont put up with any anti tourist additude. I will spend my dollars where its appreciated. Locals scream they don’t want tourists. So I plan to stay clear of them. See you at the resorts folks!

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    1. Bern- not all local residents feel this way. Many want tourism to be robust again. Hope prices come down so you can come back again. 🙂

  4. Just returned from the Big Island, and a month before we were on Kauai on Oahu. Prices were prohibitive. We had plans to go back to Big Island in June and are passing hard. Also, instead of going back to Kauai next Spring, we’ll go elsewhere. $95 for a dinner for two for basic food is beyond ridiculous. Even groceries were astronomical. I don’t know how residents are making it. It’s criminal.

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  5. On one of my vacations to Hawaii before the pandemic, I heard a joke that a person cannot throw a rock without hitting a few Californians. I suspect that the subtext is true, and us CA residents are a major share of HI’s visitors. With Silly Valley getting hit hard with layoffs as the tech sector dies down, and people fleeing SoCal, this major source of Hawaii tourism could be drying up.

    1. I think you’re oversimplifying the issue. The main reasons that people cite for leaving CA (53% in a recent survey) are housing costs. BTW, the other two major reasons are family and jobs. So, just from that perspective, if they get cheaper housing or a better job, then they have more disposable income for a Hawaii vacation. it’s also interesting to node that with the advent of remote work during the pandemic the number of middle income and higher income folks moving out of CA has increased. Finally, this move out of CA has been happening for decodes (20+ years at least).

      1. If CA residents move out to avoid Gavin Nuisances management and over taxation, they move to the Midwest or further. Try flying to Hawai’i from the mid-states. It’s a two day operation. Florida is closer. Hawaii tourism is down for sure. I hate that the pandemic killed so many good businesses owned by local families. Hawaiian Airlines is the big stickler here. They recently advertised rates from 150. Not from anywhere near me in WA, but catering to CA. I see a pattern, dont you?

  6. It could also be the really hostile attitude toward tourism which has reached a peak.when there are local checkpoints requiring visitors to pay to to hang on the n. Shore of kauai.. that’s going to make it hard to justify the price of visiting.

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