Despite a tough economic environment, Australia’s tourism sector has grown by more than 5% in the last year, driven largely by the rebirth of the family road-trip.
KPMG analysis reveals that the road trip comeback during COVID is here to stay, with domestic trips continuing to prove a popular substitute for international travel.
KPMG Urban Economist Terry Rawnsley said while air travel spending is down more than 30% compared to pre-COVID levels, road-trips remains stronger than ever.
“Spending on fuel for holidays is up almost 70% from pre-COVID levels, train travel is up more than 60% and bus travel is up 20%. Spending on holiday rentals homes, which are often found in regional locations, is also up almost 30%,” said Mr Rawnsley.
“The resurgence of the Aussie road-trip is not a flash in the pan, it’s here to stay.”
“People loved the freedom and flexibility of hitting the road during COVID and seem to be going back for more even though they can now travel internationally again. The uptick in four-wheel drive, camper vans and camping equipment purchases during COVID, coupled with cost-of-living factors has meant many see the humble road trip as a smart way to keep costs down and see everything Australia has to offer.”
This trend has also helped drive the growth in sports and recreation events, which is now up more than 40%, thanks to major sporting events like the Matildas Mania during the Women’s World Cup and interstate teams in both the NRL and AFL grand finals. The return of global stars to Australia post-COVID has also encouraged people to travel and spend money, with cultural activities up over 10% in 2023-24 compared to 2018-19.
“Successive years of lockdowns have meant for the better part of two years sport was largely confined to the TV screen, with international music concerts non-existent,” Mr Rawnsley said.
“With state and international borders reopened fans have leapt at the once in a lifetime opportunity to see the Matildas or Taylor Swift in any state they could snag a ticket."
Spending on cafes, restaurants & takeaway food services is also up almost 25% compared to pre-COVID levels to around $7.9 billion a year, compared to $5.7 billion, before COVID, suggesting holiday takeout isn’t going away anytime soon.
Tourism gross value added by industry - Volume measures
| Industry | 2018-19 ($m) | 2023-24 ($m) | % Change 18-19 to 23-24 |
| Accommodation | 10,097 | 9,874 | -2.2% |
| Air & other passenger transport | 12,448 | 8,327 | -33.1% |
| Cafes, restaurants & takeaway | 6,356 | 7,899 | 24.3% |
| Other retail trade | 6,921 | 7,781 | 12.4% |
| Holiday homes & rentals | 5,917 | 7,565 | 27.9% |
| Travel agency & info centre services | 5,888 | 5,239 | -11.0% |
| Education & training | 5,380 | 3,924 | -27.1% |
| Clubs, pubs & bars | 2,614 | 3,025 | 15.7% |
| All other industries | 2,523 | 2,503 | -0.8% |
| Sports & recreation services | 1,343 | 1,918 | 42.8% |
| Transport equipment rental | 2,070 | 1,256 | -39.3% |
| Cultural services | 1,002 | 1,130 | 12.8% |
| Other road passenger transport | 762 | 908 | 19.2% |
| Automotive fuel retailing | 470 | 790 | 68.1% |
| Taxi transport | 695 | 729 | 4.9% |
| Rail passenger transport | 338 | 550 | 62.7% |
| Casinos & other gambling | 484 | 382 | -21.1% |
| Net taxes on tourism products | 10,108 | 11,726 | 16.0% |
| Tourism GDP | 73,651 | 75,527 | 2.5% |
Notes:
- A volume measure is a measure of real growth in the economy by removing the impact of inflation.
- Ownership of dwellings in the tourism sector encompasses both the use of holiday homes by their owners and the rental of these properties to tourists. In addition, it includes the leasing of residences to working holidaymakers / short-term students.
- For more information on the industries please see here.
Source: KPMG analysis of ABS Tourism Satellite Account