As the number of COVID-19 cases continues to rise, companies involved in Alaska’s tourism industry are feeling the impacts.
According to Deb Hickok, president and CEO of Explore Fairbanks, many local hotels and tour companies are now seeing cancellations following a strong winter season.
During an Explore Fairbanks phone conference Wednesday, Hickok gave local industry members some insight into the impacts the virus is having so far. She began by noting some of the other industry-disrupting events in recent history, including SARS, the 9/11 attacks and the Great Recession of 2008.
“Besides the health and human impact, the travel industry has been on the forefront of a lot of these occurrences,” she said, adding that the biggest impact was the Great Recession, “where we saw a dramatic change in business.”
“Travelers simply didn’t have the discretionary funds,” she said. “But now we have COVID-19, which will affect us — and is affecting us right now, in terms of business.”
Hickok said, January and February were record months in terms of numbers of visitors compared to the same period last year — arrivals and departures were up 5%. That changed abruptly in March, when numbers of cases of the virus began growing in the U.S.
Hickok said Explore Fairbanks doesn’t yet have the data to illustrate the scope of the impact but that she’s heard from various companies who are feeling the squeeze.
“March is a different story,” she said. “We were hearing dramatic cancellations from winter businesses for the entire month of March and into April — and then of course, we’re starting to hear about cancellations for summer businesses.”
Among the businesses feeling the impact is Skylar Aurora Tours, which has seen various cancellations and a drop in advanced bookings, according to Glen Hemingson, the company’s business development manager.
“We really took a big hit during the Chinese New Year period, because of the prohibition of group travel out of China. Our spring break period was affected but not as dramatically, because we have so many visitors from the Lower 48 who come north during their spring break,” he said. “Advanced bookings are way down, but it’s just day-by-day.”
Hemingson noted that Skylar isn’t just an aurora tour company; it’s a full service travel agency that books outbound travel too.
“That’s been affected because of restrictions on flights to destinations around the world. That’s changing almost daily,” he said. “We’re in relatively good shape to weather this, but it all depends on how long things go on. There are undoubtedly some smaller businesses that are going to be affected a little more dramatically.”
In an interview with the Fairbanks Daily News-Miner, Hickok said that the cancellation of a number of conferences and events that would have drawn hundreds of people to the Fairbanks area is sure to have an impact on local hotels and motels. She noted that the University of Alaska Fairbanks’ One Health One Future conference, which was due to take place on March 9, was expecting some 300 attendees. The Festival of Native Arts, which was scheduled to take place in Fairbanks March 19-21, would also have drawn 300 people.
A number of local businesses have been forced to shut their doors completely. Among them are Taste of Alaska Lodge and Chena Hot Springs Resort. According to Javier Villasenor-Gaona, Chena Hot Springs’ director of advertising, marketing and sales, March is typically the resort’s most-profitable month. The resort is now closed until April 15, at the earliest.
“We just don’t want to risk anyone’s health. We haven’t had any cases, but we don’t want to be the cause for anyone to get sick,” Villasenor-Gaona said. “This is impacting us a lot. This is not something that we wanted to do. Because of the circumstances, we’re pushed to make this decision.”
The closure came with the layoffs of about 100 employees.
Now the resort is facing weeks that may turn into months of no business.
“It’s not like the rest of the hotels that depend on summer tourism; we depend on winter tourism,” Villasenor-Gaona said, adding. “We haven’t closed down in 115 years. This place has been open since 1905.”
Another recent major closure is the shutdown of the Alaska Railroad’s Winter Aurora Train, which travels between Anchorage and Fairbanks. The Alaska Railroad has suspended that service through April 30.
According to a news release, the railroad will continue to provide passenger service to the roadless area between Talkeetna and Hurricane via the Hurricane Turn Train on Thursday, April 2. Freight service will not be affected.
Railroad spokesman Tim Sullivan said that the railroad has seen a dramatic level of cancellations.
“I don’t have the latest numbers, but I can tell you we’ve seen some significant cancellations, especially from tour groups,” he said. “We do see some consistent movement from folks who use our service for Hurricane Turn.”
Sullivan said that the railroad has also started seeing cancellations of trips planned for the summer.
Northern Alaska Tour Company is canceling all tours through April 30. According to Matt Atkinson, a co-owner of the company, this is usually a busy time of the year for the tour business, which operates aurora tours and excursions throughout the Arctic. He said the decision was made following state mandates and federal health recommendations relating to travelers.
“March is typically a super busy time, with peak aurora and domestic and international travel,” he said. “With everything going on nationwide, many people have been responsible with canceling excursions. Our decision was made sort of easy by that perspective.”
Atkinson said staff are focusing on projects and prepping for upcoming seasons.
“We’re using this as an opportunity to focus on projects and being ready for, once we get over the hump, to be back and better than ever,” he said. “It is going to be an impact in a major way, but our core team is in good shape. We have the wherewithal to work on things and keep people working. We’re not looking at any layoffs.”
For some in the tourism industry, a question mark hangs over the summer. This is particularly true for those who depend on cruise ships to bring in visitors. A number of cruise lines have announced a suspension of sailing, including Princess Cruises, which has suspended operations for the next two months.
However, according to Vanessa Jusczak, director of the Denali Chamber of Commerce, it is Canada’s decision to close down all ports to cruise ships with 500 people or more until July that will have the biggest impact.
During the Explore Fairbanks phone conference, Hickok, the organization’s president, explained that this could prevent cruise ships from getting to Alaska due to a law known as the Passenger Vessel Services Act of 1886.
“The Passenger Vessel Act does not allow foreign-owned vessels — which almost all of our large ones are — to go from U.S. port to port. Hence the stop in Vancouver,” she said. “So there is an effort in our industry to request a waiver for the federal government.”
Alaska’s cruise ship season typically lasts from May to September. Jusczak said that, of the 600,000 visitors that fall upon Denali over the summer, roughly 50% are “cruise ship related.”
“Either they’ve arrived in Anchorage or Seward and they’ve come up, or they flew into Fairbanks and they’re heading down to get on the cruise ship,” she said. “With the closure of the Canadian ports, that’s really what the main concern is at this point. Because that affects everything through July 1. Half our season is gone at that point.”
Jusczak added that bookings that tend to be made around this time of the year “are just not there.”
“I think a lot of the nation is feeling this immediately. The impacts for Alaska are going to come much later and in potentially unanticipated ways,” she said. “I would say that 90% of the businesses that are tourism-related are very small — less than 10 employees. Those are the people that potentially could close their doors.”
One of Hickok’s final notes during the Explore Fairbanks phone conference was a warning regarding “risk aversion” or “confidence shock.”
“That’s a general feeling by the traveling public that accompanies events like this,” she said, explaining that travel restrictions and general unease often have a ripple effect, putting people off the idea of traveling in the short or long term.
“When are customers going to feel confident about travel? For us, because we’re a long-haul destination, we primarily rely on air travel. So what are customers going to think about air travel? And specifically what are they going to think about landing in the hubs of Sea-Tac and LAX, which are two of our major hubs for our travelers?”
On the other hand, she said, Alaska may be construed as a “safe place.”
“There is, sometimes in these situations, an increase in domestic travel, which helps mitigate some of the cancellations of international travel. That’s what happened during SARS,” she said, noting that she’s already heard of a group of 100 people who were planning on a trip to Europe this summer but are now planning to come to Fairbanks.
“We don’t know how prevalent that will be,” she added.
Contact staff writer Alistair Gardiner at 459-7575. Follow him on Twitter: @FDNMoutdoors.