The global economic turmoil is starting to affect the New Zealand tourism industry.
Tourism New Zealand chief executive George Hickton says there has been a drop in tourist numbers of between 6% and 8%, and summer looks bleak.
Visitor numbers have been slowing for a while, but it was not until three weeks ago that the dip became reality.
Mr Hickton says the industry is bracing itself for a further downturn of up to 10% this summer and possibly more in March and April.
He is urging operators to market themselves to those holidaying at home, saying the backpacker market is still strong.
Trevor Hall, chief executive of motor home company Tourism Holdings, says the tourism industry needs help from the Government.
Mr Hall is calling on Prime Minister-elect and future Tourism Minister John Key to come up with a rescue package.
LA office closed
Tourism Holdings has closed its office in Los Angeles and warns it will lay off more staff due to the global financial crisis.
The company says its US business was not sustainable and it needs to shed $3 million from its wage bill to further reduce costs.
At its annual meeting on Tuesday, the company told shareholders it expects to make a trading loss in the first six months of the year, but recent asset sales will boost its balance sheet and result in a full-year profit.
Even so, it says that profit will be well below last year's $14 million.
Mr Hall says bookings for motor home rentals over the crucial summer months are down 9% for its Australian business, and down 13% for its business in New Zealand.
Head of research at Forsyth Barr Rob Mercer says that, despite the short-term pressure, Tourism Holdings is in a strong position to emerge from the economic downturn intact and the company sold its assets at the right time.
