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‘SWOT Analysis’ Of NZ Travel Industry Reeling From COVID-19 Crisis


  • The COVID-19 pandemic sparked an unprecedented crisis in the booming travel sector, triggering widespread revenue and job losses.
  • However, remarkable growth in domestic and virtual tourism is instilling strength in the beaten industry.
  • It is hard to neglect the brutal impact of international border restrictions on the NZ travel industry, in terms of overseas revenue.
  • Weakness prevails in household income and consumer spending levels, which must spring back to support the travel sector’s revival.
  • The execution of the trans-Tasman travel bubble and eventual development of COVID-19 vaccine are likely to unfurl a slew of opportunities for the travel sector.
  • The existing state of recession and second infection wave remain grave threats to the travel sector’s recovery.

While Kiwi Land’s stringent lockdown restrictions enabled it to gain control over the COVID-19 spread, these curbs delivered a crushing blow to the flourishing travel sector. At the time when NZ is pulling out all the stops to reboot its multi-billion-dollar travel sector, a SWOT analysis seems crucial to better gauge the current and potential developments in the journey business.

The tourism industry has always stayed at the core of the NZ economy, delivering substantial economic gains over the years. As per the Tourism Industry Aotearoa (TIA), tourism was NZD 112 million per day industry in Kiwi Land prior to the COVID-19 pandemic. The industry contributed ~NZD 47 million per day to the NZ economy in foreign exchange before the virus outbreak, with domestic tourism delivering the rest NZD 65 million.

The COVID-19 pandemic sparked an unprecedented crisis in the booming travel sector, triggering widespread revenue and job losses. While NZ travel industry is battling to survive the virus crisis, here is an extensive SWOT analysis of the sector:


Though there seems to be a long way off for the NZ travel sector to resurrect to the pre-pandemic stage, remarkable growth in domestic and virtual tourism is instilling strength in the beaten industry.

Virtual tourism emerged as a silver lining in the dark virus cloud, keeping travel-hungry Kiwis well-fed. To offer a sense of voyage to travel enthusiasts, Tourism New Zealand launched a super cool video game, PLAY NZ, in July 2020, guiding virtual tourists through a never-before-seen tourism experience. Likewise, some other tourism players also brought forth virtual travel adventures into the living rooms of travel lovers, keeping them engaged during lockdowns.

Besides, Kiwis pivoted towards domestic travel amidst COVID-19-driven overseas border restrictions, offering some sort of cushion to the battered travel industry. In June and July, Air New Zealand experienced a huge demand for domestic travel, especially into leisure destinations.

Moreover, 64% of the Kiwis intend to take domestic holidays over the next 12 months, as per a report unveiled by Tourism New Zealand in June 2020.

Must Read: Three Key Trends Defining Travel Sector’s Recovery from COVID-19 Storm


Despite some promising indications, it is hard to neglect the brutal impact of international border restrictions on the NZ travel industry, particularly in terms of overseas revenue.

As per the recent data from Stats NZ, overseas visitor arrivals plunged by ~252k in July 2020 relative to last year, with the biggest fall in arrivals (122k) seen from Australia. The coronavirus-induced border and travel restrictions have reduced migrant departures and arrivals to the lowest levels in recent months. Stats NZ noted an average of 7.6k arrivals and 19k departures in every month from April to July 2020, as against 526k arrivals and 555k departures during the same period in 2019.

Additionally, one cannot overlook the existing softness in household income and consumer spending levels, which must spring back to support the travel sector’s revival. There has been a considerable drop in household spending appetite amidst COVID-19, which is further weighing on the NZ consumer confidence. The Westpac-McDermott Miller consumer confidence index plummeted to 95.1 points in September 2020 quarter, which is the lowest reading since the Global Financial Crisis (GFC).


With Australia being Kiwi Land’s biggest source of tourists, the execution of the trans-Tasman travel bubble will potentially unfurl a slew of opportunities for both the nations. Speculations are rife that the travel corridor between Australia and NZ is likely to be up and running by November this year.

While NZ was previously aiming for whole-Australia approach in resuming international travel, it is now planning to opt for a hotspot regime. In other words, the nation is expected to open travel corridors with those Australian states, where the virus spread is contained. The initiation of the travel bubble is anticipated to rekindle trade ties between Australia and Kiwi Land, supporting the travel industry recoil to its pre-pandemic shape.

Notably, the trans-Tasman travel bubble is also likely to pave the way for NZ’s travel corridors with other nations in the future.

Besides travel corridors, the eventual development of COVID-19 vaccine is also expected to remove a major stumbling block in the sector’s road to recovery, enabling Kiwis to feel safe while travelling again.


With Kiwi Land into its first recession in decades, the recovery of the hammered travel sector is unlikely to be a cakewalk. NZ’s recession has heightened fears of a surge in the unemployment rate and decline in consumer spending over the coming months, which can set back the speed of the travel sector’s revival. Besides, the second wave of COVID-19 infections also continues to remain a grave threat to economic revival.

In a nutshell, it is difficult to perceive the actual shape of the travel sector’s recovery from the Global Virus Crisis, with NZ in its worst economic slump since the Great Depression. Sooner resumption of overseas travel, critical vaccine developments and sustenance of critical government support seem vital for the sector’s uninterrupted path to restoration.

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