JAPAN. Leading travel agencies expect to see an improvement in outbound travel by the end of the second quarter, according to Travel Journal International (TJI) Online*.
TJI cited the latest findings of the much-respected Diffusion Index (DI) survey by the Japan Association of Travel Agents (JATA).
TJI noted: “A 12-point rise in the DI is good news for the travel industry, which has faced continual bad news month after month with falling numbers of travellers and shrinking demand.”
The results are based on the responses from an Internet survey of JATA-member companies conducted between 16 February and 2 March.
The DI reflects business sentiment of the Japanese travel industry. Responses range from “˜very good’ to “˜good’, “˜average’, “˜fairly poor’ and “˜poor’ to questions on business conditions for the given period broken down by destination and market sector. “˜Very good’ has an index of 100 while at the other end of the spectrum “˜poor’ is -100. “˜Average’ is 0.
Commenting on the increased confidence levels, TJI noted: “The decrease in fuel surcharges from April to June and the ongoing strengthening of the Japanese Yen against world currencies, including the South Korean Won, have helped encourage travel agencies handling overseas travel.
“With long-haul routes in particular showing a big reduction in fuel surcharges by as much as -80% at some airlines, family travellers and seniors are expected to benefit from the cost savings.”
According to JATA, the DI for families will improve some 9 points from -74 last quarter to -65 this quarter while that for seniors will climb some 14 points from -46 to -32 – the strongest DI of all market sectors. For over two years the seniors market has led outbound travel, ahead of female office workers and honeymooners.
In the latest findings, honeymooners (-45) and students (-70) each will show an increase of 7 points, TJI said. The office women sector will grow 4 points to -65 while the incentive and business-inspection sectors will post a three point rise to -76 and -70, respectively.
Incentives will remain the weakest sector, TJI said, as companies revamp their corporate policies regarding overseas travel in the face of Japan’s economic slowdown.
Asia strongest, Europe to post biggest rise
With the incentive of lower fuel surcharges, long haul destinations will show improvements in demand, TJI said. The survey reveals an 11 point improvement in the DI for Europe, going from a -70 in the last quarter to a -59 this quarter – the biggest improvement of all major regional markets.
North America will go from a -79 to a -75, up four points.
China, hit by food scandals which have deterred many Japanese travellers in recent months, will post an eight point rise to -74.
Asia, the strongest of all regions, will go from a DI of -39 to -33, thanks in large part to the growing popularity of South Korea – a destination that has benefited hugely from the strengthening of the Yen against the Korean Won.
Hawaii will improve 4 points to -59 from a -63 and Oceania, buoyed by Australia, will improve 3 points to -79 as the Japanese Yen will generate more spending power due to a weakened Australian Dollar, TJI said.
Micronesia, anchored by Guam and the Northern Marianas, will remain unchanged at -61.
*Editor’s note: The Moodie Report works closely with TJI Online, the largest English-language travel trade news source in Japan. Week in, week out, it provides timely and sharp analysis of the all-important Japanese travel market – international and domestic. To subscribe please visit https://tji.tjnet.co.jp. It comes with our highest recommendation.
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