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F1 to rev up numbers for tourism
ONE of the year's biggest events, the Formula 1 Singapore Grand Prix, is back, giving the tourism industry a shot in the arm after the industry's subdued performance in the first half of this year. This seventh edition of the race has also brought a new title sponsor in the form of Singapore Airlines (SIA), which is seeking to maximise brand exposure not just to the thousands of race-goers around the track but the millions around the world who tune in to watch the night race.
This year, SIA's distinctive blue and gold colours are clearly emblazoned around the street circuit, including at spectator entrances, the Paddock Club, and at the F1 village, where the carrier has a mock-up of its new-generation products for its First, Business and Economy class cabins.
At the Paddock Club in the heart of the circuit, the airline is entertaining guests, with cabin crew on hand to give those in attendance a first-hand taste of SIA-style hospitality. Come Sunday night, 50 Singapore Girls will be at the starting grid too.
"Strategically, our objective is to boost Singapore as an exciting global city. Part of that is to promote Singapore as the hub connecting the world, and for people who want to travel around this region as well," said SIA's divisional VP (sales and marketing) Foo Chai Woo. "What's good for Singapore is good for us, ultimately."
SIA, which is battling sliding yields due to stiff competition from rival carriers, has been selling F1 packages ahead of this weekend's race, as well as leveraging on its own network and that of sister carrier SilkAir to tag on stopovers for travellers keen to explore the region. Efforts were also made to create more buzz for the Singapore Grand Prix in markets such as India, Taiwan and London through roadshows and media engagement.
Taking over from telco SingTel, the carrier inked a two-year title sponsorship contract in April and is said to be paying under S$10 million per year.
Race promoter Singapore GP has released some 80,000 tickets for sale this year, although this is lower than the 87,500 sold in 2013 when strong demand prompted the release of additional seats. The final sales tally for the seventh edition of the Singapore Grand Prix was unavailable on Friday night.
Race weekend typically delivers a fillip for the tourism industry, as 40 per cent of racegoers generally hail from overseas. According to figures from the Singapore Tourism Board (STB), more than 250,000 tourists have come to Singapore between 2008-2013 for race weekend cumulatively, with incremental tourism receipts averaging S$150 million per year. 2009, however, was an exception due to the global financial crisis.
The Royal Plaza on Scotts hotel is running at 95 per cent occupancy, with guests largely coming from Australia, the United States and the United Kingdom. Starting at S$680, room rates are similar to last year's Grand Prix weekend but higher than an average weekend. "We have seen stronger demand this year. Occupancy over the F1 weekend has increased by 3 per cent compared to last year," said general manager Patrick Fiat.
Even post-F1 weekend, signs could be pointing to a pick-up in 2H14 for Singapore's tourism industry. This comes after visitor arrivals slipped 2.8 per cent year on year to 7.5 million in 1H14, as the impact of new tourism laws in China and the twin Malaysia Airlines tragedies dampened demand from Chinese travellers. Arrivals from Singapore's second biggest source market slumped as much as 30 per cent in 1H14.
But preliminary data from STB shows that visitor numbers from China nearly doubled month on month in July to around 180,490, up from about 91,420 in June.
While arrivals from China were still down 27 per cent year on year in July, the decline eased from the sharper drops of 52 per cent and 45 per cent experienced in May and June respectively.
OCBC economist Barnabas Gan said in a recent research note that July's figures likely represented tourists shedding concerns from recent air mishaps, adding that the recovery on the tourism front should continue.
Meanwhile, DBS economist Irvin Seah said tourist arrivals could start to see improvement in the coming months, although there could also be some impact from the haze.