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HAWAIIS TOURISM INDUSTRY A FEW THOUGHTS Hawaii Transportation & Infrastructure Summit June 25, 2014

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Adjusting our sails

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Most isolated land mass in the world Dow Jones fluttering just above the 16,000 mark Ukrainian crisis could affect travel dramatically on short notice Crude Oil fluctuating, now above $102.00 a barrel Dollar strengthening against international currency Length of Stay shortening to adjust for travel budget Airlift adjusting to demand Harsh Winter, and cabin fever could be our best friend Our World

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Executing Supply and Demand HTA CustomerAir Lift Brand Hawaiian Islands Accomm Marketing and Promotion Brand Promise Reputation

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The Hawaiian Islands 920 flights per week Connecting 53 cities worldwide By 21 carriers

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Access Honolulu ranked as the 4th busiest international port of entry for the U.S. NEED: Re-establish Kona as a 2 nd international port of entry. TOTAL% change PORTSOVERSEAS2014/2013 Rank MIAMI, FL355,8562%1 NEW YORK, NY323,25211%2 LOS ANGELES, CA244,47716%3 HONOLULU, HI173,54310%4 SAN FRANCISCO, CA127,96520%5 *YTD as of January 2014. Source: U.S. Department of Commerce, ITA, National Travel and Tourism Office.

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Arrivals from Major Market Areas: Relative Size (2013)

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2013 Arrivals by MMA

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2013 Arrivals International vs Domestic

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Air Route Development Conditions Differ by Market North America20122013 Seat Inventory 7,008,1777,206,155 Load Factor 87.1%88.4% Airline Yield (per RPM) $0.101 International20122013 Seat Inventory 2,910,0913,277,478 Load Factor 80.0%76.5% Airline Yield (per RPM) $0.227$0.157 *Excludes Other MMA

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Total scheduled air seats could reach record levels (again) in 2014 Source: Hawaii Tourism Authority, based on data from Diio Mi airline schedules as of March 31 2014 Total Seats 20072008200920102011201220132014F 9,813,5898,854,8778,353,2088,948,3369,207,48310,206,73110,768,71911,040,460

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Honolulu International Airport International Flights Schedule Arrival TimeAlFlightOrgSeats 0600Air Pacific Ltd.820Nadi, FJ180 0615Hawaiian Airlines482Tahiti, PF260 0640Jetstar Airways -OR- Alba Star.es3Sydney, NS, AU303 0700Delta Air Lines638Tokyo-Narita, JP403 0705United Airlines880Tokyo-Narita, JP272 0725Japan Airlines76Tokyo-Narita, JP230 0750Korean Air Lines51Seoul, KR280 0805Hawaiian Airlines444Brisbane, QL, AU260 0815China Airlines18Tokyo-Narita, JP383 0835Qantas Airways3Sydney, NS, AU229 0845Delta Air Lines598Fukuoka, JP218 0845Japan Airlines74Tokyo-Narita, JP230 0905Delta Air Lines578Tokyo-Narita, JP298 0915Delta Air Lines278Osaka-Kansai, JP298 0920Asiana Airlines232Seoul, KR290 0925Hawaiian Airlines450Osaka-Kansai, JP294 0930All Nippon Airways1052Tokyo-Narita, JP215 0935Japan Airlines72Tokyo-Narita, JP230 0940Korean Air Lines53Seoul, KR335 0945Hawaiian Airlines454Fukuoka, JP260 0955Delta Air Lines612Nagoya, JP218 0955Hawaiian Airlines442Sapporo, JP260 0955Japan Airlines84Nagoya, JP230 1005Hawaiian Airlines452Sydney, NS, AU294 1015Japan Airlines78Osaka-Kansai, JP230 1040Japan Airlines80Tokyo-Haneda, JP389 1100Hawaiian Airlines460Seoul, KR260 1200Hawaiian Airlines458Tokyo-Haneda, JP294 1240All Nippon Airways1062Tokyo-Haneda, JP215 2025Air New Zealand10Auckland, NZ234 12 flights arrived between 9:05 and 10:05

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Scheduled Air Seats Outbound Interisland Seats Source: Diio Mi, based on airline schedules for the day of Friday, May 2, 2014

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In the first 4 months of 2014 The State Experienced: $40.8 million in visitor spending per day $521.4 million in state tax revenue generated 54,835 jobs supported 22,673 visitors arrived daily

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In the first 4 months of 2014 Each County Experienced: $19.2 mil per day $4.2 mil per day $11.1 mil per day $5.8 mil per day Direct Visitor Spending ($ million)

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2013 Visitor Unit Counts by Type of Accommodation

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State Tax Revenue: Everyday visitors contribute $4.6 million in state tax Note: Calendar Year 2002-2013 Actual

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What are other destinations doing to compete with the Hawaiian Islands?

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Hawaii Logo Competitor Logo Exercise HTA believed that the rainbow brushstroke logo, while it had been unique and fresh when first introduced, had become lost among the competitor logos. It was believed that other destinations had copied Hawaiis look and feel. September 2010: MVNP gathered other rainbow destination logos to verify that this was indeed the case and developed the existing bamboo font logo.

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Mexico Los Cabos Tourism Boards Flip for Cabo Consumer Blitz June 26, 2013 from 11am 7pm at The Grove Los Angeles Through a partnership with popular luxury flip-flop brand, Havianas, the event aimed to drive consumer traffic to The Grove's central park area with live entertainment, cooking demos, trip giveaways and a series of authentic Cabo experiences.

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Mexico Mexico Taxi Project In 2011, the Mexico Tourism Board launched a $25 million campaign designed to overcome Americans perception that the country is unsafe. An element of the campaign were testimonials shot in a style similar to the TV show Taxicab Confessions where visitors were given a transfer home from the airport to discuss their Mexican vacation on camera. These testimonials can be found on www.visitmexico.com.www.visitmexico.com www.youtube.com/watch?feature=player_embedded&v=LN15Q4kCJxw $43.3 million by the Mexico Tourism Board + $10 million rebranding of Vallarta Nayarit

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Caribbean In March 2013, Jimmy Buffet announced his partnership with Wyndham to open a 262-unit timeshare resort in St. Thomas.

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NEXT STEPS

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No one leader for change Its a new era We have to lead together

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If we only spend our time fighting for our piece of the pie who will bake new pies? We need to bake new pies

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Infrastructure Message from Roger Dow, US Travel Association, June 18, 2014 The travel community's message: air travel hassles are keeping potential flyers at home and costing our economy billions. Investing in our nation's aviation infrastructure needs to be a national priority. "We cannot have a big league economy with little league infrastructure...We must continue to invest in our infrastructure to remain economically competitive." Rep Larsen

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Hawaii could go into a deeper hole Marketing is only as good as its product We need to invest in the destination Clean Safe Friendly What we do in the next 5 years will affect the next 50: There is no time. We must grow. We must diversify. We must refresh our product.

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5 Rules from our Uncles and Aunties No get big head eh! No need talk stink! No hog the cheese! Be proud of your heritage, but no make shame! Play to win vs play to lose!

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The world will turn to Hawaii as they search for world peace because Hawaii has the key and that key is Aloha. Auntie Pilahi Paki ALOHA

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MAHALO The Hawaiian Islands is our Hklea