The Inbound Report

Covering the Inbound Tourism Industry Since 1996

Foreign Students Now Comprise 10th Largest Overseas Source Market for Visit USA Travel

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According to the just releasedOpen Doors Logo, the number of international students at U.S. colleges and universities surpassed reached 1,044,000 during the 2015-16 academic year—a number that, were foreign students a market unto themselves, would make them the 10th largest overseas source market for inbound travel to the USA. The student market would rank just ahead of Italy (1,039,000, according to arrivals data for 2015 prepared by the U.S. National Travel and Tourism Office) and behind the UK, Japan, China, Germany, Brazil, South Korea, France, Australia and India.

The Open Doors report, which is prepared by the Institute of International Education (IIE) in partnership with the U.S. Department of State‘s Bureau of Educational and Cultural Affairs, also noted that China sends more students to the U.S. than any other country—328,547—which would make this block of students alone the No. 23 overseas source market. This would place the Chinese student market just behind the country market of Ecuador and just ahead of the country market of Denmark. Other highlights from the Open Doors report include the following:

—While students from China and India remained the leading countries of origin and accounted for 84 percent of the growth in international students in 2015-16, Saudi Arabia’s government-sponsored international scholarship program helped drive that country to surpass South Korea to become the third largest sender of international students to the United States.

—Meanwhile, the number of students coming to the United States from Brazil declined by 18 percent in 2015-16, the largest decline recorded and one that is likely due to the freeze in the Brazilian government’s Scientific Mobility Program, which previously sponsored many Brazilian students’ U.S. studies.

—California is the most popular state for international students in the USA. It hosted nearly 150,000 international students in 2015-16. Four of the top 20 U.S. host institutions for international students were located in California, with the University of Southern California ranking second, just behind New York University. New York is the second leading host state, and New York City is the leading host metropolitan area.

The tables below illustrate the growing size and reach of the population of students from other countries in the United States.

 

International Students Share of U.S. Higher Education

intl-students-a

Source: 2016 Open Doors Report on International Educational Exchange, released by the Institute of International Education (IIE) in partnership with the U.S. Department of State’s Bureau of Educational and Cultural Affairs.

 

Number of International Students in U.S. by Top 25 Countries

 

intl-students-bSource: 2016 Open Doors Report on International Educational Exchange, released by the Institute of International Education (IIE) in partnership with the U.S. Department of State’s Bureau of Educational and Cultural Affairs.

 

 Top U.S. States Hosting International Students

intl-students-cSource: 2016 Open Doors Report on International Educational Exchange, released by the Institute of International Education (IIE) in partnership with the U.S. Department of State’s Bureau of Educational and Cultural Affairs.

 

Top U.S. Institutions Hosting International Students

intl-students-dSource: 2016 Open Doors Report on International Educational Exchange, released by the Institute of International Education (IIE) in partnership with the U.S. Department of State’s Bureau of Educational and Cultural Affairs.

A Quick Dissection – – the Brazilian Slump Points to Recovery:

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Brazil CurrencyTour and travel industry professionals have been nearly unanimous in their belief that the Brazilian market is ready for a rebound—for instance, Orlando-based Jay Santos, managing director USA for the Brazilian operator Grupo Trend, told an industry conference two weeks ago that he was “bullish” on Brazil for 2017—for several reasons:

First, while arrivals to the USA from Brazil are expected to decline significantly this year, many observers point to the decline as a result of the political trauma the nation has experienced this year—due to the impeachment and removal of a president and scandals involving Petrobras, the nation’s semi-public, multination energy corporation.

Second, a downward spiral in the currency exchange rate, which hit a low point last February when the Brazilian real sunk to $0.25 against the dollar, seems to have been checked, and the real is back at about $0.30—a 16 percent recovery from its low point. (See chart below)

real-vs-dollar

Third, a major challenge to travel abroad has disappeared. Part of the problem for Brazilian operators in the first quarter of the year was an increase, at the beginning of 2016, in the tax on remittances abroad from 6 percent (an effective 6.38 percent by the time other charges are incorporated) to 25 percent (a de facto 33 percent). By March, the Brazilian Congress and then-President

Fourth, Brazilians have kept traveling and kept spending when they have traveled, but they have spent less. Confirmation of this came with the recent release from Visa Performance Solutions, a consulting firm of the global financial institution, which conducted a study on the consumption profile of Brazilians in their international purchases.

In the survey, which collected transactional data from the company’s payment network between 2013 and 2015, Visa noted that, despite continuing to consume, travelers have changed their purchasing priorities. “Consumer behavior has changed. He/she did not stop spending, what changed was his/her profile of purchase.” Said Rodrigo Santoro, director of Visa Performance Solutions in Brazil. The study also revealed that, in addition to changing their priorities in spending, they’ve also changed their destination priorities.

Most significant is the change in spending on clothing by Brazilians. When the Inbound Report interviewed shopping center executives in the Orlando area in the summer of 2015, we learned that Brazilians were shopping less for clothing—which used to be their number one purchase while on vacation. No more. The new top five categories of spending are in the following table.

brazilian-spending

Other points of interest from the Visa survey include the following:

—Brazilian spending abroad is concentrated in the United States and Canada (46 percent), despite a high drop in transaction volume.

—The top four destinations, all in the United States—Orlando, Miami, New York and Las Vegas—alone accumulate an incredible 20 percent of total spending.

—Orlando, Miami, New York and Las Vegas are the leading cities which, Santoro says, are “very stable” and that changes in ranking are not expected in future surveys.

—Santiago, the capital of Chile, emerges as the fifth city with the largest flow of expenses of Brazilians around the world, surpassing Fort Lauderdale, Florida.

 

 

And the Worst Airport in the USA is …

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top-100-airports-bReleased just in time for the holiday season in the U.S. is the list of the Top 100 Airports in the country. According to the report’s creator, TravelPulse, its editors spend a good part of the year traveling the globe and have experienced the glaring disparities between international and domestic airports.

More than 300 respondents, both consumers and aviation experts, were asked via Google Survey to rank airports in seven categories – ease of access, amenities, airline volume, terminal modernity, terminal comfort, family friendly and business friendly.

Attention to detail is largely missing in U.S. airports, as countries around the world have trumped statewide airports on the innovation and design creativity fronts.

 

Highlights from the survey results:

—Atlanta Hartsfield-Jackson was voted best airport in the country for its ability to handle high volume of airlines, passengers, and get them in and out. But in large part, Atlanta finished so high because it also finished first for the number of amenities it offered and for being business friendly.

—Size matters! Many respondents said the ability to choose from among numerous airlines, at differing times, offering better fares, was important to them and that can only be found at big airlines. The top six in airlines volume satisfaction among those surveyed were LAX, JFK, O’Hare, SFO, Orlando and Vegas. In the business friendly category, all of the top five were also the biggest airports in the country.

—Small airports did very well – Fort Myers, Manchester, Columbus, Savannah, and Greenville were all in the top 50.

—For such a big airport (14th in the nation in passenger volume) respondents found Orlando the easiest to access both getting to (and with parking being $17/day to self-park compared to $33 at JFK) and once inside (its famous tram system).

—Honorable Up-and-Comers: A lot of earned kudos from readers were for newer airports; Phoenix, Portland, Ore., and Nashville.

—Two airports that had undergone massive renovations and makeovers in the last 20 years, Detroit and Denver, also came out on top.

—Of all the categories, readers were most passionate about terminal comfort. Detroit “won,” but most said it’s almost impossible to be comfortable in an airport terminal.

Top 10 Best Airports

  1. Atlanta
  2. Orlando
  3. Denver
  4. Minneapolis
  5. Charlotte
  6. San Franciso
  7. Seattle
  8. Tampa
  9. Detroit
  10. Baltimore/Washington

Oh … last on the list in New York City’s La Guardia Airport. Here is the complete list.

 

top-100-airports

 

A Note on Methodology: TravelPulse asked respondents to rank as many airports as they could among 115 that qualified under its criteria – the facility either processed 700,000 or more passengers in 2015 per Federal Aviation Administration rankings, or are the top-ranking representative of their state.

The methodology including asking respondents to rate airports based on these seven categories:

* Ease Of Access. How is getting to the airport via car or public transportation? Is there sufficient parking, moving walkways, trams and other amenities that makes access easy?

* Terminal Modernity. Is it older or newer? Has the airport embraced newer technologies with Wi-Fi, modern signage and device chargers?

* Terminal Comfort. Is it clean? Easy to navigate? Plenty of seating?

* Amenities. Are there numerous food options, including healthy choices? What about shopping and entertainment options, massages and sleep lounges?

* Business Friendly. Does the airport offer good commuter flights and nonstop? What is its proximity to the nearest city? What about airport lounges and business centers?

* Family Friendly.  Are there ample changing stations, kid-friendly food options and clean play areas?

* Airline Volume. Does the airport serve a high number of airlines? If it is dominated by one carrier and being used as a hub, are there enough strong destinations and nonstop flights?

For the German Travel Trade, It’s been a “Lost Year”

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german-travel“The travel agency sector has effectively lost a year of growth,” said the Nuremberg-based marketing research firm GfK as it released the latest monthly data on travel agency sales for the year ending Oct. 31st. The report is based on an analysis of bookings by 1,500 travel agencies.

The Bad News:

—According to GfK’s latest market survey, German travel agency vacation sales have declined by 5 percent this year; the worse news is that winter bookings are still weak so far. Other sobering points noted in the GfK report including the following:

—The numbers mean that the German organized travel market has recorded its first revenue in years.

—Summer revenues dropped by 7 percent.

—The main reason for the drop-off was an overall 29 percent decline in sales of holidays in the Eastern Mediterranean, which outweighed growth in Western European and other destinations.

—Demand for winter holidays is also weak at present, with an 11 percent drop in bookings compared to October 2015, leaving accumulated bookings so far for winter 2016/17 down by 8 percent.

The Good News on the Horizon:

—Early bookings for summer 2017 are 1 percent ahead of the same period last year, and they accounted for nearly 47 percent of total revenues last month, 10 percentage points higher than in October 2015.

—Meanwhile, Germans are continuing to book more cruise holidays than ever before; there was a 43 percent rise in bookings last month compared to October 2015, according to the monthly sales survey of some 2,500 travel agencies by IT services company TATS. They are now running at an overall 12% increase.

—Travel agents are currently more optimistic than in recent months after writing off this year and looking ahead to 2017. The latest FVW “sales climate index” conducted in early November showed.

—About one quarter of German travel agents now expect rising sales in the coming months and about half expect stable revenues, which is higher than the comparable figures one month earlier.

 

What has been the Impact of Brexit on UK Outbound Travel to North America?

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brexit-updateLooks like Nothing: The latest data released by the UK’s Office for National Statistics (ONS) show that there was little change in the steady upward increase in the number of visitors to the USA by residents of the UK since the June 23rd vote by UK citizens to leave the European Union (EU). In fact, the just-released numbers show that, in the peak travel months of July, August and September, UK departures for the quarter increased by 8 percent over the same period in 2015. And, year-to-date, departures for North America increased by 4 percent vs. 2015.

uk-cit-departures

 

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Tom Berrigan, Managing Editor/Producer
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