Tourist Industry Rushes To Fill Void Extended Slump In Exchange Rate Slows Flow Of Canadian Travelers
Last year, hotels, attractions and shops around the Inland Northwest survived the Summer the Canadians Stayed Home.
Now, they face the sequel.
Albertans and British Columbians have shied from the trip south mostly for one reason: the sagging value of the Canadian buck.
The exchange rate that typically gave Canadians about 80 of our cents for each of their dollars now pays about 70 cents, about the same as a year ago.
Businesses on both sides of the border expect swings in the exchange rate. But a two-year slump is rare.
Currency analysts blame Canada’s soaring federal debt and political unrest in separatist Quebec for smothering the exchange rate. Until Canada gets its financial house in order, the rate likely won’t improve.
As a result, the annual Canadian influx to North Idaho and Spokane has fizzled.
For Ray Thieman, owner of the Red Top Motel in Spokane, the Canadian market that used to make up 22 percent of his business has been reduced to zero.
Spokane hotels that experimented with taking Canadian currency at par - the same value as the U.S. dollar - have given up on that strategy for the most part, he said. “There just aren’t any takers, not even at par.”
In fact, many tourist-related businesses have given up on the Canadians, and are looking elsewhere for business.
The completion of the Spokane Arena provides a potential new source of revenue. And the rapid growth of Hoopfest has provided another annual tourist draw to complement Bloomsday, the Lilac parade and other traditional events.
“We need a few more Hoopfests around here,” Thieman said.
North Idaho hotels may find it tougher to fill the Canadian void.
The currency slump coincides with a rapid expansion of hotel properties. Now, industry observers say North Idaho’s lodging market is overbuilt.
Once a new Holiday Inn Express under construction on Sherman Avenue near Interstate 90 opens sometime in August, nearly 500 hotel rooms will have been added to the area in the last few years, said John Kozma of the Coeur d’Alene Convention & Visitors Bureau.
One way to gauge Canadian traffic is by the number of inquiries for tourist information at visitor centers in the area.
Canadian inquiries for information at Spokane’s convention bureau are off from 1994’s low numbers, said Carolyn Ogden of the bureau. However, it’s too early to predict from May’s numbers if the trend will hold through the season, she said.
Requests for information about Spokane are up overall, she added. Marketing Spokane in other areas like the Tri-Cities and Missoula has generally filled in the Canadian gap.
Inquiries for information at Coeur d’Alene Convention & Visitors Bureau are about equal if not a little bit better than last year, said Kozma.
There are even some indications that Canadians have simply accepted the higher exchange rate and will visit here despite paying more, Kozma said.
That reflects some efforts being made by North Idaho businesses, which are more dependent on tourism than their counterparts in Spokane.
Local banks offer an advantage to Canadians who trade their dollars for American money, and that’s sometimes not well known, Kozma said.
“We’ve got to get the word out that if Canadians wait to exchange their money down here, they’ll get between five and seven percent discount on the exchange rate,” he said. “If more realized that, we’d get more down here.”
Ogden sees another reason for optimism. The unfavorable exchange rate has made businesses work harder, and that could translate into more business in the future.
“The exciting thing is that once the rate goes back down to where it was, we’re going to be doing great,” she said.
Some businesses had to refocus.
“We weren’t put here to rely on a fickle tourism market to the north,” said Charles Fenwick, marketing director at the Coeur d’Alene Greyhound Park, a particular favorite of Canadian visitors. “Don’t get me wrong - we love our Canadians - but 60 to 70 percent of our revenue comes from the greater Spokane and Coeur d’Alene markets.”
The park’s addition of simulcast racing has been a boon, though rumors of the facility’s closure have grown louder with less Canadian traffic. “They’ve been secondguessing us ever since we started. The fact is we had our best financial year last year,” Fenwick said.
New Silverwood Theme Park General Manager Daniel Aylward said his park has refocused its marketing to concentrate on the Spokane area as well. Canadians used to make up a big chunk of Silverwood attendance, but now that percentage is in the single digits.
Still, Silverwood and most other tourism businesses are surviving - some even thriving.
Retail sales in restaurants and shops that depend on summer crowds showed healthy increases in Kootenai County. Spokane hotels by and large did well enough.
The constant variables for tourism - weather and the national economy - will probably play a larger role than how many Canadians come south.
The National Weather Service’s longest range forecast projects normal temperatures and rainfall through the end of July.
Though the economy seems to be weakening, a survey by the AAA Auto Club suggests that more people will be traveling this summer than in the last several years. The survey asked 1,500 people if they would be driving or traveling more than 100 miles away starting with the Fourth of July weekend, according to Dave Carlson, AAA spokesman in Boise.
“This holiday weekend will attract more travelers than at any other time since 1987,” Carlson said. “Travel overall will be up about 3 percent, we predict.”
But because of a slow start in June, the tourism season will have to really pick up the pace to match last year.
“I don’t think the tourist season will be any better than last year, if as good,” said Bob Templin, owner of Templin’s Resort and newly named member of the Idaho Tourism Council.
“We’d be better off probably to try to get more convention groups here to play golf and go boating, which are our best attractions.”
, DataTimes ILLUSTRATION: Graphic: Canadian dollar detours tourists