The number of tourists coming here could be down by as much as 20 per cent. Alison Healy looks at some of the factors contributing to one of the worst seasons in years
The tourism sector was already facing a difficult year in the aftermath of September 11th and the foot-and-mouth crisis but the latest woes at Aer Lingus have created one of the bleakest outlooks for the industry in years.
A depressed German economy is also adding to tourist industry worries. The German market is the third largest after Britain and the US.
The Irish Tourist Industry Confederation is concerned that the regular airline disputes will give the State a bad name in foreign markets. "The danger is that Ireland will be seen as an unreliable or difficult market," says Mr Brendan Leahy, the confederation's chief executive.
"It's happening already. People are afraid they will be stranded here. It's damaging our image and it won't be forgotten."
He says the strong investment in marketing after the foot-and-mouth crisis is being negated by the spate of holiday cancellations coming in.
Tourism Ireland will be reviewing its forecasts as the effects of the Aer Lingus dispute are calculated, according to Ms Niamh Fitzpatrick, marketing director of the all-Ireland body, which promotes the country overseas.
It had estimated conservatively that business from the US market would fall by 10 per cent this year. "We have to review it now," she says. American trade is more valuable than that from other countries as US tourists stay longer and spend more money. "One American tourist is worth about the same as two tourists from Britain."
CIÉ Tours is vulnerable to any reduction in US tourists, who make up 60 per cent of its customer base, managing director, Mr Brian Dowling, says.
The company brings up to 80,000 visitors to the State every year, Mr Dowling says. CIÉ Tours had "spent a lot of money" trying to win back customers in the wake of September 11th and it was beginning to get results. "But then this happens."
He expects business will have fallen by about 15-20 per cent on last year and points out that last year was poor because of foot-and-mouth.
It's extremely difficult to predict what will happen in the coming months, according to Mr Malcolm Connolly, Bord Fáilte's corporate development manager. The only obvious trend is that tourists are booking much later.
Bord Fáilte had predicted a nine per cent fall in business from the US this year, but with a 20-25 per cent drop in airline seats between the US and this State, the target is "extremely challenging" and the drop in business could be closer to 14 or 15 per cent.
Mr Connolly says the fall in business was not a major surprise as the market would have taken 18 months to recover from last year's setbacks.
"A key strategic goal is to get the route network structure back in place and to try to get Ireland at the top of the pecking order."
Dublin Tourism has already noted a 30 per cent drop in the number of visitors to its six tourist offices between January and the end of April this year. Its chief executive, Mr Frank Magee, estimates that the number of tourists visiting the city will drop by between 10 and 20 per cent this year.
The loss of American custom is a particular worry for the hotel sector as some hotels rely on the American market for up to 65 per cent of their business.
Now, even if some Americans have conquered their fear of flying, the reduction in airline capacity places more obstacles in their path.
"There is very serious concern out there at the moment," says Mr John Power, Irish Hotels' Federation chief executive.
Hotels are promoting the home market to make up the shortfall. The overseas market accounted for 50 per cent of bed nights in 2000. This reduced to 46 per cent last year.
The Incoming Tour Operators Association predicts a fall in business of at least 15-20 per cent this year.
"It could be worse than that. It's a matter of guesswork as people are booking very late," says Mr Alan Glynn, chief executive.
The American market accounts for almost 50 per cent of business for tour operators and they are concerned that the Government is not taking the matter seriously.
"The problem is not being recognised," says Mr Glynn.
Figures are being distorted when people quote numbers of people travelling through airports, he says, as many of these are not tourists.
"We need more money for marketing. Britain has put additional millions into the promotion of tourism," he says.
"It's the same in the rest of Europe. They are all trying to capture a shrinking market post-September 11th. But the problem is not being recognised here."
The Irish Tourist Industry Confederation is calling for a once-off fund of at least €20 million to compete with the intensive marketing campaigns of countries such as Britain and Canada.
The €32 million marketing fund for this island has almost been allocated at this stage, while the British Prime Minister, Mr Blair, is appearing in US television advertisements promoting Britain as a holiday destination.