Outbound Canada Travel Trends & Trip Intentions

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1 Outbound Canada Travel Trends & Trip Intentions Jennifer Hendry Senior Research Associate Canadian Tourism Research Institute

2 Topics Economic trends and the exchange rate Canada s aging population Outbound travel performance Historical and YTD Winter travel intentions Short-term outlook for sun destinations Caribbean, Mexico, USA

3 Economic Outlook and the Outbound Travel Market

4 Canada s Real GDP Growth 3.4% 3.0% 2.6% 2.0% 1.9% 2.0% 2.4% 2.3% 2.2% 1.2% 1.3% f 2016f 2017f -2.7% Source: The Conference Board of Canada

5 Provincial Real GDP Growth, % 2.0% 1.8% 1.7% 2.1% 2.1% 1.3% -0.2% -1.1% -1.2% NL PEI NS NB QC ON MB SK AB BC Source: The Conference Board of Canada.

6 Canadian Population Growth, Atlantic 1.2% QC 3.4% ON 3.8% MB 5.0% SK 6.1% AB 7.5% BC 5.1% North 4.9% Canada 4.2% Source: The Conference Board of Canada.

7 Diversity of Canada s Population % change (absolute) Population (000s) 32,522 42, % Visible minority (000s) 5,285 12, % Rest of the population (000s) 27,237 29, % Source: Statistics Canada, Catalogue number X Distribution of the foreign-born population by continent of birth Americas 66.7% 62.2% 54.3% 46.9% 42.0% 36.8% 31.9% 28.1% 25.0% 22.5% 20.5% Europe Asia 14.1% 18.4% 24.6% 31.4% 36.5% 40.9% 45.2% 48.6% 51.3% 53.6% 55.4% Africa Oceania Source: Statistics Canada, Projections of the Diversity of the Canadian Population, 2006 to 2031

8 Canada s Population is Aging The share of Canada s population aged 55+ is increasing dramatically. Between 2015 and 2019, the proportion of Canadians aged will increase 8%, while the share of people aged 65 and older will increase 15%. In Ontario, the proportion of residents aged will increase 11% The proportion of people aged 65+ will increase significantly in both ON (+15%) and QC (14%) % change in population (2019 vs 2015) Canada ON QC under % 2.6% 6.4% % -4.4% -8.0% % 5.9% 3.1% % 3.0% 7.1% % -6.7% -8.3% % 10.9% 5.5% % 14.8% 13.6% Source: October 2015, CBoC forecast.

9 More Seniors than Children - First Time in History! population <15 population aged Source: Statistics Canada, CBoC

10 Exchange Rates & Household Spending Household consumption is expected to remain stable Real disposable income will average 1.9% annual growth Loonie lost 20% of its value from Economic Indicators ( ) 2015f 2016f 2017f Real GDP (% change) 1.3% 2.4% 2.2% Real Disposable Income (% change) 2.5% 1.3% 2.0% Household Consumption (% change) 2.0% 2.2% 2.1% CAD/USD (annual average) $0.78 $0.75 $0.79 EUR/CAD (annual average) $1.42 $1.42 $1.35 GBP/CAD (annual average) $1.94 $1.96 $1.86 Conference Board of Canada (September 2015 Outlook), Oxford Economics World Outlook.

11 13,580 13,750 15,420 16,489 17,849 19,741 21,580 21,296 23,376 24,674 26,396 26,872 27,279 26,919 Canada: Total Outbound Leisure Trips ( 000 of outbound leisure trips, all destinations) Global Recession f Source: Statistics Canada, CBoC

12 Annual Leisure Visits to the Caribbean and Mexico Between 2006 and 2014, leisure visits to Mexico grew 10% and leisure visits to the Caribbean grew 6%. 1,022 1,100 1,314 1,407 1,414 1,453 1, ,469 1,650 2,079 2,296 2,329 2,390 2,487 2,334 2, p Caribbean (000s) Mexico (000s) Source: Statistics Canada, CBoC

13 2015 Sun Destination Performance (% change, Jan-August 2015 versus 2014) Anguilla Antigua Aruba Bahamas Barbados Belize Bermuda Cayman Islands Costa Rica Cuba Curacao Dominican Republic Grenada Guatemala Jamaica Mexico Panama Puerto Rico St. Kitts/Nevis St. Lucia St. Maarten St. Vincent -17% -11% -11% -11% -7% -6% -1% -1% 2% 3% 6% 5% 5% 4% 5% 7% 9% 13% 13% 16% Source: Country tourism departments and government agencies.

14 Winter Travel Intentions

15 Winter Travel Intentions Overall, trip intentions this winter are lower than last year Two-thirds intend to spend their longest overnight trip outside the country Smaller share plan to travel to Mexico and the Caribbean 62% 65% 67% 61% 77% 65% 67% 69% 65% 65% % 41% 38% 41% 34% Total Trip Intentions Outbound Trip Caribbean/Mexico Source: CBoC Annual winter travel intentions survey

16 Winter Travel Intentions Still a lot of uncertainty; 8% of those planning an outbound trip this winter have not selected a destination, and 6% of those who have selected the Caribbean have not yet determined where they will go Demographics keeping intentions from dropping off more drastically; 36% of those planning a winter trip are 55+ Lower intentions from largest MX/CARIB market (35-54 yrs) who account for close to half of travel to the region MX, Cuba, DR will see some growth High prices/low dollar will affect other destinations, but higher income travellers are less price sensitive 35% of travellers planning a trip south have a household income of at least $95k One-third of all overseas travellers who are still in the dreaming or investigative phases of their trip planning intend to travel to MX/CARIB

17 Travel Outlook: Caribbean Destinations

18 Caribbean and Mexico, Direct Seat Capacity Since 2011, direct seat capacity on scheduled carriers has grown at an average annual rate of 22% 2015p 3,322,916 1,729, ,012,053 1,608, ,680,454 1,386, ,111,616 1,348,941 Caribbean ,367, ,628 Mexico Source: OAG

19 Canadian Visits to Mexico & the Caribbean (thousands of overnight visits each year) 1,414 1,453 1,511 1,562 1,619 1,690 1,760 1,850 2,487 2,334 2,350 2,405 2,489 2,590 2,650 2, p 2015f 2016f 2017f 2018f 2019f Caribbean (000s) Mexico (000s) Source: Government of Mexico, Statistics Canada, CBoC

20 Canadian Visits to Cuba, (000s) ,002 1,072 1,106 1,175 1,235 1,292 1,356 1,428 1, f 2016f 2017f 2018f 2019f Source: CBoC forecast

21 Canadian Visits to the Dominican Republic (000s) f 2016f 2017f 2018f 2019f Source: CBoC forecast

22 Canadian Tourism Research Institute Outbound Canada Jennifer Hendry Senior Research Associate

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