Australian Tourism Feels Pinch of Strike : $4-Million Daily Loss, Occupancy Slump Hit Resorts and Hotels

Australia’s tourist industry, starved of domestic airline services for the past week, is facing ruin because of widespread cancellations by nervous overseas visitors, operators said today.

Resorts and hotels reported a slump in occupancy rates since the weekend when travelers realized that the dispute, which has grounded all domestic airlines since Thursday, was set to continue for some time.

“Everybody’s bleeding here at the moment,” said Gaynor Cooper, marketing manager of the Yulara Resort in the shadow of Ayers Rock in the central Australian desert.

“We would expect to be 100% full at this time of year but our occupancy rate is very low. People are canceling because they are afraid they won’t be able to get back home,” she said.

The Australian Tourism Commission estimates the dispute is costing the industry $4 million each day.

Tourism is Australia’s most important foreign exchange earner and reaped $4.9 billion from around 2.2 million visitors in the last financial year.

“We’ve had quite massive cancellations from abroad. There’s been a huge loss of confidence,” said Owen French, manager of a string of island resorts off Queensland. “Overseas travel agents are just taking Australia out of the schedules.”

About 1,600 pilots resigned en masse last week after the three largest domestic airlines refused to consider their demand for a 30% pay raise, bringing chaos to the transport system of the continent.

The airlines said they had received more than 800 responses from pilots to job advertisements they placed in newspapers around the world. But they warned it would take about four weeks for the applications to be processed and new pilots trained.

A spokesman for the tropical resort of Hamilton Island, which reported a 50% drop in occupancy rates, said it was chartering aircraft at great cost to ferry in Japanese tourists from Sydney and Cairns.

Hotel and resort operators said they were cutting staff working hours and considering temporary layoffs to reduce losses. Larger operators are considering suing the pilots for damages, industry officials said.