The weak U.S. dollar has left Singaporean Terence Lim and his family squabbling over whether to shop in wintry New York or tour balmy California when they embark on their first-ever American holiday in December.
Daunted by the long flight and forbidding price tag of a two-week U.S. vacation in the past, the Lims opted to travel to Australia, China and New Zealand in recent years – but the plunge in the greenback has put America back on their travel map.
“There’s no point going all that way for just one week, but the cost for a two-week holiday was very expensive before” says Mr. Lim. “Now it’s more affordable. The big question now is where,” he laughs. His 16-year old daughter wants to shop in New York, but his son, 14, wants to hit Disneyland.
Standing outside a travel fair organized by the National Association of Travel Agents Singapore at the weekend, Mr. Lim and his wife peruse holiday brochures. “Maybe we can do both,” suggest Mrs. Lim.
With Asia’s economies fast recovering from the global economic crisis, savvy travelers in the region are now looking for destinations where their local currencies can be stretched further. And the laggard economies in the west, particularly the U.S., have created a boon for Asian travelers.
While the cost of flights on Asian airlines, which are priced in local currencies, has stayed largely the same, the big savings are in the form of hotel and food costs, said Robert Khoo, CEO of NATAS.
For Singaporeans traveling to the U.S., a three-day resort hotel package at Disney’s Grand Californian Hotel and Spa, for example, including tickets to the park, costs S$200 ($153) less today than it did in January, or about 6 percent less. Once in New York, tourists like the Lims will also pay S$21 per ticket less, or savings of 7 percent, to the Broadway production of West Side Story compared to a year ago.
Some Asians are saving more than others. Regional currencies that have surged the most against the U.S. dollar include the Japanese yen, the Thai baht, Malaysia’s ringgit, the Philippine peso, India’s rupee and the Australian and Singapore dollars. The Hong Kong dollar remains pegged to the greenback, so there’s been no boon for travelers there.
The United States hasn’t been a destination of choice for Asian travelers for years, largely due to price and distance, plus security concerns following the September 11th terrorist attacks. The country also hasn’t run any travel campaigns in Asia for years, leaving the ground open to more aggressive tourism push from countries like New Zealand and Australia.
But its weak currency is changing all that.
Singapore’s CTC Travel has seen a 20 percent jump in the number of travel bookings to America in the fourth quarter, over the same period last year. At the NATAS travel fair, the company was offering a nine-day tour of America’s West Coast for just S$1,888, excluding taxes - nearly S$200 less than an eight-day tour to Australia.
“Australia is definitely more expensive than the same time last year,” says Alicia Seah, senior vice president of market at CTC Travel. CTC also had a 30% rise in bookings to Europe over the June-August period, over the year before. “Europe was more popular because the exchange rate was so good,” Ms. Seah said.