Canadians Won't Travel to the US

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. October 14, 2008

OTTOWA, Canada, March 31, 2006. In advance of the Canada-US-Mexico Summit meeting in Cancun, the Hotel Association of Canada (HAC) has released a travel survey that shows the negative impact of a U.S. passport requirement.

The United States government's new regulation requiring all citizens entering the U.S. via air and sea, including Americans returning home, to be in procession of a passport is to take effect on December 31, 2006. The issue of passport requirements is on the agenda when Canadian Prime Minister Stephen Harper, US President George W. Bush and Mexican President Vicente Fox meet in Cancun.

As of December 31, 2006, the United States Government has a requirement that all citizens entering the US via air and sea, including Americans returning home, must be in possession of a passport. The issue of passport requirements is on the agenda when Prime Minister Harper, and Presidents Bush and Fox meet in Cancun.

In the Hotel Association of Canada/Fleishman Hillard survey, 37 percent of Canadians say they would take at least one trip to the US this year, with the majority (24 percent) indicating at least a one-night stay. However, when asked if they would still travel to the U.S. if a passport requirement were in place, 27 percent said they would likely cancel the trip.

America is Canada's largest inbound market. Almost 75percent of Canadian business comes from the US. If a huge percentage of Americans needs to cross the border but will cancel travel due to the passport issue, Canada's meetings and conventions business will suffer tremendously. The Conference Board of Canada reports that the loss will be about $1.7 billion over 3 years. (Currently, only about 20percent of Americans has passports). Conversely, American hotels, conventions and meetings loss is estimated at $785 million once the requirement is in place.

HAC President Tony Pollard says, "Clearly this will have a negative impact on travel and trade between Canada and the United States and there needs to be a workable solution arrived at including a delay of implementation. The U.S. and Canada are each other's largest trading and tourism partners. It only makes sense that they work collaboratively on this issue."

"First of all, when this was announced in April by the US Congress to be applied to air and ferry travelers (for East and West Coast travels), we realized the government was very firm on this issue. We remain America's full-fledged partners in safety and security," said Pollard pointing to the absence of any incident, for instance, in Detroit during the SuperBowl in February. The city is just right on the border of Canada and the US. On their part, the Canadian Armed Forces, the Royal Canadian mounted police, the Ontario Provincial Police, and the City of Windsor Police played a major role in protecting the SuperBowl, according to Pollard as he pointed out in a letter to Secretary of State Condoleeza Rice and Secretary of Homeland Security Michael Chertoff. "This is one perfect example of how Canada and the US can be partners in continental security."

The Hotel Association of Canada is the national organization representing the lodging industry in Canada. Membership encompasses the provincial and territorial hotel associations, the corporate hotel chains, independent hotels, motels and resorts and the many suppliers to the hotel industry.

Vice President, Research at Fleishman Hillard Canada, Gail Haarsma says, "The data indicates that a disproportionate number of regular travelers will not go to the United States if a passport is required. This is a significant finding for the Hotel Association."

The survey was conducted with 2007 adult Canadians by Fleishman Hillard Canada (formerly GPC Public Affairs) about their leisure and business travel as well as opinions on current issues affecting travel in Canada. The overall margin of error is +/-2.2 percent, at a 95 percent confidence interval. The survey took place December 12 through 20, 2005.

Toronto-based Richard Carret, President of See America, the committee that enhances travel from Canada to the US said that caution should be exercised when looking at the numbers. "Majority of the people who currently travel by air will be able to continue traveling by air even if there is a passport or a more secure document required. Some won't. But the air market, if at all, will be very lightly affected. The market that will be affected will be the close-end, drive-market - the discretionary, occasional people who travel on day-trips. People who don't prepare for travel won't choose to, in either direction," said Carret who pointed out that Canadians can avail of the Nexus or the Pass Card as an alternative. (Nexus however costs $ 90).

Ontario-based, Canadian broadcaster Dave Hunter, the author of Along Florida's Expressways said the regulation will certainly discourage Canadians on a budget or have a family going down to destinations such as Walt Disney World. "Though a state such as Florida will be a draw for upper- to middle-income Canadians, it will be difficult for families to go out and pay for passports (costing about $90 each). Only about 37percent of Canadians has passports right now. Other passport problems include unapproved passports due to blurred photos, photos with inadequate lighting or with shadows (or that they were smiling in it." With the strict passport photo requirement, perhaps the number without passport will remain at 37 percent.

Implementation will largely influence the road travelers and day-trippers. "Quite often, Canadians decide to take advantage of a lovely day and go for a drive across the border. Trips like this are not planned for many days in advance. "A lot of these people are not going to have passports unless they travel for business," said Hunter. He added that from a Canadian point-of-view, both nations are so close to each other there is no real physical distance to travel. Canadians have always felt it has always been a right to go across the US border, rather than a privilege. On the spur of the moment, day-trippers will just stay home, shop or go around Toronto and other Canadian cities and spend their money within the country.

Pollard said it is important that this issue is underscored when Prime Minister Harper meets with Presidents Bush and Fox today. He said, "The problem is that the implementation is coming on so quickly, that today we're only 9 months away. Trade across the border, movement of people and goods, including tourism, will be greatly restricted. We need to find a solution with America so as not to allow this interruption."

"People should understand the context of what the number represents. I could see maybe a 20-25percent drop in the beginning for day travelers for Toronto to Buffalo. But those doing a long-stay trip to Florida, for instance, will get a passport. Most of them already have anyway," said Carret. In context, the numbers are saying 37percent of Canadians has passports. And 63percent does not. That is not to say they don't travel. And there are 30 million Canadians. "Not all 37percent of the 30 million travel. Nobody has gone to all who traveled and surveyed if they want to travel or not. Rest assured that number will be much higher! Be careful with the numbers. We should not get overly concerned with the numbers!" People should not panic about the numbers that on the surface look very dramatic, added Carret.

Pollard insists the impact is not only on Canada, but on America, as well. "We continue to work closely with the US. But we are concerned that as of January 1, 2007, the system will be impeded," said Pollard adding a sufficient number of people - truck drivers, businessmen, service providers, officials, etc. will be affected. The Canadian hotel group would like to see a delay to allow people to be able to cross the border, considering security.

"We need America and Canada to be able to come up with a solution that will benefit us all," closed Pollard.