If you are pricing a trip to Hawaii right now, the latest preliminary February visitor report from the state helps explain why it still feels so expensive. Hawaii is getting a lot more money without getting anything close to the same jump in visitors, and that is the gap travelers are feeling when they look at airfare, hotels, rental cars, and food. Visitor spending rose 10.3% to $1.91 billion, and way outpaced arrivals that were up just 3.6% to 787,024.
When spending rises much faster than visitor arrivals, even with more airline seats in the market, it suggests Hawaii still has room to hold or push prices higher without losing enough visitors to force a meaningful reset. That does not guarantee your next trip will cost more, but it does help explain why there is still no sign of meaningful relief.
The state is treating that as positive growth, and on paper, it is. But this does not look like some giant new rush to Hawaii vacations. Otherwise, arrivals would be climbing much faster, too. Instead, Hawaii continues to extract more from the visitors it already has, with modest growth on top of that. It is the combination of airfare, hotels, vacation rentals, 19% taxes, meals, fees, and all the smaller costs that now hit harder than ever.
Airlines added seats faster than visitor growth.
The airline side makes this interesting. Air capacity to Hawaii in February rose by nearly 8% in seat count. Arrivals rose just 3.6%. So this is not a simple story where airlines are keeping supply tight with planes that are instantly full, and prices moved higher because everybody on the mainland suddenly decided to book Hawaii at once. Not at all.
The state is getting more air service, more seats, and still a much bigger jump in spending than in visitor counts. That does not look like a classic boom, and it looks more like Hawaii has found its niche, a higher pricing level that is holding even as capacity expands. For travelers, there is no good news here, as there is no clear sign that pricing pressure is easing at all.
U.S. visitors to Hawaii are driving this.
U.S. West and U.S. East accounted for the vast majority of visitors, and both markets saw increases in arrivals and spending. These are the travelers carrying Hawaii: mainland visitors still willing to pay for Hawaii even as the overall cost of the trip stays stubbornly high. At the bottom line, mainland visitors are still coming and still spending in Hawaii.
Maui is the exception.
Maui is revealing a somewhat different story. Arrivals were up 11.5%, and spending was up 6.8%, with hotel occupancy climbing to 78% from just 71.5% a year earlier. That is genuine demand recovery, not just the same number of visitors paying more. Two and a half years after the fires, Maui is the one island where the growth is showing up in actual people, not just dollars.
What this means for your next Hawaii trip.
Hawaii remains expensive because enough people are still paying expensive-Hawaii prices, and the February report shows the state achieving a much bigger rise in money than in people.
But Hawaii has not gotten cheaper, and this report continues to point in the other direction. The islands are still expensive and show no sign of resetting.
Have you noticed that the costs of a trip to Hawaii have been changing over the past year or two, or has it settled down for you? Has anything changed how often you come or what you book?
Photo Credit: © Beat of Hawaii.
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This is still working out for them because income inequality is expanding at a rapid pace. Hawaii is moving away from a middle class experience, and more towards the wealthy. Who are, so far, doing very well.
But watch the market drop and they’ll see a huge drop off as people don’t feel secure and will stop spending money.
Income inequality hasn’t started last year or even a decade ago, so in reality it has very little to do with the demographics of Hawai’i visitors.
I keep hearing about a growing number of “wealthy” visitors, but when I look around, I see regular people who don’t seem to be wealthy at all, but obviously able to work, save and afford a nice vacation. Many of them quite young, but all age groups are represented, even the seniors.
At the end of the day, whatever the social or economic trends might be, it all boils down to a good old supply and demand.
Well the silver lining in this latest info is airline capacity is increasing and just slightly outpacing actual pax loads. That’s good news for us lowly non-revs and could just put a little downward pressure on airfares ..,.
I don’t think there’s any corresponding news for the hotels, car rentals & other hospitality entities….. Slowly, Hawaii is poisoning the golden goose with an overdose of greed…. But, we may soon see shifting winds with the situation in Iran & resulting economic consequences…..
I hope you’re right! We Don’t need any more people here! Lived here 44 years now and nothing has ever changed, visitors just keep pouring in! I’m starting to believe Nothing can kill this golden goose! The high Prices, taxes on everything higher especially for tourists, restaurants, rental cars, the fire, storms and the fact that locals are fed up with all the tourists. Don’t get me wrong Maui is still beautiful but it’s got allot of scars from recent events and nowhere like it used to be!
David, this is what you get when you forget to shut the door behind you.
For anyone who can afford to spend anywhere from 5-10k or more on such a vacation, an airfare price jump of 25% even 50% is not going to make them reconsider the trip.
A temporary instability and uncertainty in world affairs might even boost the number of visitors who’d feel safer traveling to Hawai’i than to some overseas destinations. Overseas airfares won’t get more appealing either in this scenario.
Looking at the big picture Hawai’i still remains one of the top choices for many Americans.