$2m study of airlines-tourism link

Tourism contributes 9 per cent of New Zealand's GDP. Photo / Paul Estcourt

Tourism operators may soon be able to get a better idea of how changes in the aviation sector can affect business.

The University of Otago has begun a three-year research project looking in to the political and economic factors affecting international and domestic air travel in recognition of how critical aviation is to the New Zealand tourism industry.

Associate professor of tourism David Duval, who is heading up the research project, said he hoped to make the findings accessible to all tourism businesses so that they could use the information to make informed business decisions.

"If a winery in the Hawkes Bays wants to know what it will mean for them if an airline like Emirates triples its flights to New Zealand, we hope to be able to answer that."

Duval said changes in the aviation sector, such as when Air New Zealand pulled out of Singapore several years ago, had potential to affect many parts of the tourism sector. "We want to be able to explain the reasons behind that and whether it should be a concern."

The research would also run a model simulation of a major shock to the New Zealand economy such as an airline pulling out of New Zealand to examine the effects.

"Tourism is worth 9 per cent of GDP. At the moment we are celebrating getting one million people from Australia yet at the same time the airline industry has been hit by some pretty hard externalities like Sars, the recession and swine flu."

Duval said airlines had two major concerns at the moment; cashflow and cash reserves and it could only take a factor like swine flu to send an airline under. While he did not believe the major airlines were under threat he said others may not be around in three months time and that could have serious impacts on the tourism sector.

The research is one of three projects recently announced by the Government and is being funded by the Ministry of Tourism and Foundation for Research, Science and Technology.

The University of Victoria will also be looking at long-term scenarios to better understand the options for New Zealand tourism and Lincoln University has been charged with finding out how the physical effects of climate change will impact tourism in New Zealand.

In total $2 million will be spent on the research over the next three years.