While economic growth has been sluggish this year, low gas prices and a weak Canadian dollar have helped boost travel to and within Canada. Overnight visits are on track to expand by 3 per cent this year and next, according to The Conference Board of Canada’s latest Travel Markets Outlook for both national and metropolitan cities.
Ottawa, November 23, 2016—While economic growth has been sluggish this year, low gas prices and a weak Canadian dollar have helped boost travel to and within Canada. Overnight visits are on track to expand by 3 per cent this year and next, according to The Conference Board of Canada’s latest Travel Markets Outlook for both national and metropolitan cities.
“The tourism sector is one of the handful benefiting from the low Canadian dollar. We’re seeing increased levels of both U.S. and international visitors that are nothing short of tremendous and restore much of the travel volume lost during the past decade,” said Greg Hermus, Associate Director for the Conference Board of Canada’s Canadian Tourism Research Institute.
On top of the nearly 10 per cent growth last year, overnight visits from the U.S. are expected to increase a further 7.8 per cent this year. Beyond the low Canadian dollar and gasoline prices, Canada is known as a safe travel destination which is inevitably resonating with American travellers as many other competing destinations struggle with safety concerns. Similarly, overseas arrivals to Canada saw an increase of 8.7 per cent this year, but are expected to cool slightly in 2017 to an estimated 6.4 per cent.
Growing consumer confidence, increases in disposable income and a few major events, in particular the 150th anniversary of Confederation and Montréal’s 375th anniversary, will see domestic pleasure travel increase by an estimated 3.2 per cent in 2017.
Travel prices are forecasted to continue ramping up slowly with increases ranging between 2.1 and 2.3 per cent between 2017 and 2020. While travellers were hit with a 3.7 per cent increase for accommodations in 2016, a more moderate annual increase at a pace between 2 and 3 per cent is expected across the forecast horizon. Travellers can also expect to spend between 2.1 and 2.4 per cent more for food and beverage services.
Of the nine Canadian cities covered in the Travel Markets Outlook’s Metropolitan Focus, most can count on tourism growth between 2 and 5 per cent next year. With business and consumer confidence still suppressed in Alberta and low energy prices affecting local and provincial economies, tourism activity in the province is slated for only modest gains next year. Meanwhile, Ottawa–Gatineau is expected to experience the strongest growth in domestic pleasure travel with an increase of 6.4 per cent in 2017 as travellers flock to the capital city to celebrate the 150th anniversary of Confederation.
Domestic overnight visits to the city are projected to increase by 2.8 per cent before the end of the year, while overall visits to the city should grow by 3.8 per cent. The King’s Wharf waterfront project is scheduled for completion in spring 2017 and should attract both business and pleasure travel to Halifax, with overnight visits set to grow 3.1 per cent in 2017.
The renewal of hotel space and major sports events have contributed to a strong year for pleasure travel in Montréal. The city will experience a 4.3 per cent increase in overnight visits in 2016. As Montréal celebrates its 375th anniversary in 2017, a further increase of 5 per cent is projected for overnight visits.
Overnight visits to Québec City are expected to grow by 3.7 per cent in 2016, with pleasure travel receiving a boost from the recently completed Videotron Centre, a multi-use indoor arena. Visits from the U.S. to the city are expected to grow by 8.9 per cent this year amidst low gas prices and a favourable exchange rate.
With sporting events such as the Canadian men’s curling championship and strong gains from international markets, overall visits to the city are estimated to increase by 3.4 per cent in 2016. Celebration for the 150th anniversary of Confederation in 2017 will see overnight visits to the nation’s capital grow considerably. Other major events, such as the 125th anniversary of the Stanley Cup and the 105th Grey Cup will also lend a hand in the projected 6.4 per cent increase in domestic pleasure travel next year.
Strong convention activity will lead to growth in business travel to Canada’s largest city this year. In 2017, pleasure travel is projected to increase by 3.5 per cent, boosted by Toronto hosting Prince Harry and his Invictus Games and the NHL Centennial Classic Game.
Business travel is set to grow 3.6 per cent in 2016, receiving a boost from the recently completed RBC convention centre. In 2017, a 3.3 per cent increase for overall overnight visits is expected as the city hosts the Canada Games and opens a new outlet mall.
Attendance at the Calgary Stampede was at a 22-year low in 2016. The outlook is much brighter for 2017 with pleasure travel expected to see a boost as a result of the recently opened National Music Centre and the Calgary Film Centre. Overnight visits to the city should expand by 2.5 per cent in the new year.
With the continuing weakness of the energy sector, local tourism activity suffered this year. While overnight visits to the city are projected to decline 1.7 per cent in 2016, strong growth from the U.S. and overseas markets should help contribute to an increase of 2 per cent in overall overnight visits next year.
Vancouver will see a 6 per cent increase in tourism activity in 2016. Next year, the city will benefit from hosting a number of large sporting events, such as the NCAA basketball tournament and the Canada Sevens rugby tournament. Overall, overnight visits are projected to increase 4.1 per cent in 2017.
Join Jennifer Hendry of Canadian Tourism Research Institute as she presents the latest results of the Canadian Travel Intentions survey in this webinar. She will discuss economic indicators that are impacting travel patterns, where Canadians plan to travel this winter, and how Canada's changing demographic is affecting outbound travel trends.