Tourism hinges on functioning air travel. How does the impact of the pandemic on Canada’s economy compare to its current state in 2024?
Canada was devastated by the lack of travel, particularly air travel in the international visitor space. We are a very large country, 15 times larger than France, so conducting business or allowing people to visit friends and family across the nation is very challenging when airlines are grounded. The impact of COVID was as deep as it gets.
However, by the end of 2023, our total revenues, in nominal terms, recovered to 2019 levels. Tourism has proven to be a resilient part of our economy, even though we were at ground zero for months and slow to reopen borders compared to other nations. We're now looking forward to amazing prospects for our industry between now and 2030.
How have traveller trends and behaviour changed, both in terms of inbound and outbound traffic?
Initially, as the pandemic receded, people were eager to travel from urban centers into the countryside and explore nature, which Canada has in abundance.
Over time, people have gravitated back to cities, but the unique aspect of Canadian cities is that you're never far from nature. This proximity to nature is a unique aspect of travel in Canada that has staying power as we emerge from the pandemic. Initially, travelers chose to travel almost irrespective of cost.
Now the market is becoming more cost-sensitive, though not among high-value travelers. We focus on highly engaged travelers who prioritize the values of traveland getting to know a destination. They are staying longer, engaging with local culture, and eating local food. We want to ensure the guests we invite to Canada are prioritizing travel values over volumes.
A couple of our key international markets have shown strong recovery, notably the UK, France, Australia, and Mexico. Europe has generally outperformed Asia, and our American friends are not quite back to their 2019 levels, which is significant for us. Overall recovery includes a mix of international and domestic business and leisure travel. Leisure travel came charging out of the gates in 2022 and hasn't slowed down. Business events have been slower to recover, with Zoom proving effective for many types of engagements. We're about 85-86% recovered in terms of business events, and we expect full recovery by 2026 in terms of delegates and the number of events.
Destination Canada has some ambitious objectives for the coming years. Can you share your 2030 strategic objectives and the roadmap to achieving these goals?
Our goal is to achieve $160 billion in revenue by 2030, and we're focusing on competitiveness over the next five to seven years. Currently ranked 11th in the world for tourism development, we aim to be in the top seven by 2030. This involves improving access to the country, seamless borders, and high-quality experiences. Emerging from COVID, restoring air access and routes was central to our strategy. We partnered with airlines and airports to reestablish key routes and developed long-term partnerships with international airlines.
We always partner with domestic carriers like Air Canada and WestJet, as well as United Airlines, American Airlines, and Delta Airlines. Along with our partners, we also support domestic carriers on important routes, like Air Canada's New York to Halifax route, which is critical for Halifax. We've also started working with international airlines such as British Airways and Air France to strengthen our international routes. Our partnership with Air France brought them into Ottawa as a seasonal route, which proved so popular it became a year-round route. Sometimes just introducing an airline to a market establishes the demand needed for a successful route.
As you ramp up your activities, what presents as the main challenges standing in the way of meeting growing demand?
Travel demand is strong, and the production of aircraft and the number of available routes make it a competitive space. We must offer airlines a strong competitive position and a solid demand basis for maintaining routes. Our challenges aren't unique but require us to be at our best in this hyper-competitive space.
Our competitors are often our key source markets, such as the US. For instance, we compete with cities like Seattle versus Vancouver or New York versus Toronto for major routes. Aircraft are highly mobile assets, unlike hotels, so we must ensure everything is working well to maintain these routes.
