Gold Coast braces for tourism fallout from Dreamworld

The Gold Coast leisure and hospitality industry fears consequences from Dreamworld, but hopes they will not last.

DreamWorld’s Buzz Saw is an inverted roller coaster..

The emotional and financial toll from the Dreamworld disaster could radiate across the Gold Coast’s volatile tourism sector, threatening hotel occupancies, airline bookings and the fortunes of other theme parks.

Key hoteliers, airline executives and Gold Coast tourism burghers refused to comment on how Dreamworld will restore its reputation following the death of four patrons on Tuesday, just as the park was moving into its peak Christmas trading season.

Already the tragedy has financially hurt the theme park’s listed owner, with Ardent Leisure shares plunging 22 per cent at opening yesterday, wiping $253 million from its market capitalisation.

Other tourism operators were caught up in the Ardent malaise. Qantas shares plunged 3.5 per cent yesterday; hotelier Mantra, which manages at least 16 Gold Coast properties saw 4 per cent wiped from its value; and Ardent’s rival theme park operator Village Roadshow was down 4.4 per cent.

Gold Coast Mayor Tom Tate says “time will tell” what effect the Dreamworld tragedy would have on the Gold Coast’s 13.3 million annual visitors and its $5.1 billion tourism market.

“Incidents like this hit us hard emotionally and as a community,” Tate tells The Australian.

“That’s why it’s important the investigation is thorough and runs its full course. People will want to know what happened and be assured it won’t happen again.”

It can be difficult for tourism companies to restore their reputations, says Carnival Corporation executive chairwoman Ann Sherry, who single-handedly turned the local cruise industry around following the appalling death of cruise passenger Dianne Brimble on board a P&O Cruises ship in 2002. “Out of respect for everyone concerned, we wouldn’t presume to offer a commentary on the way forward for its operators,” Sherry tells The Australian.

“As a general observation in no way linked to this terrible tragedy, tourism is in many respects a risk management undertaking and restoring reputation can be complex.

“Again in general terms, issues need to be addressed head-on if a damaged reputation is to be restored. In our case, a tragedy became the catalyst for the complete transformation of cruising and the product that the industry offers.

“The community expected us to act and we continue to work to meet their high expectations.”

Dreamworld’s attendance will be hit over the upcoming peak Christmas trading period “and beyond, as a result of negative press commentary”, according to an analyst’s note from Citi based on overseas theme park accidents.

A major accident at Merlin Entertainments’ Alton Towers theme park in Staffordshire, England, injured 16 patrons, including two teenagers who needed leg amputations. That accident last year resulted in a 20 to 30 per cent drop in attendance, even though there were no fatalities, Citi says.

Merlin Entertainments was recently fined £5 million over its Smiler rollercoaster crash and the company admitted it had breached the Health and Safety Act.

One of the Gold Coast’s biggest hoteliers, Mantra chief executive Bob East, predicts there will be no medium to long-term impact from the Dreamworld tragedy. “Our offering in Queensland remains diverse and will remain world standard and I do not foresee any impact,” East says. “In time we will be coming out and talking more about the industry, but today is not the day. Everyone watching this incident at the moment is focused on the tragedy.

“I honestly don’t know that we can speculate on any impact.”

Flight Centre chief executive Graham Turner says the tragedy will have a short-term impact on the Sunshine State’s tourism industry.

And former federal tourism minister Martin Ferguson tells The Australian, the hotel industry hopes the accident “does not undermine the desires of international tourists to come to Australia as we are historically a safe haven”.

Ardent Leisure’s chief executive, former magazine publisher Deborah Thomas, and outgoing chairman Neil Balnaves were unavailable for comment. But it is believed Balnaves will speak about the Dreamworld disaster at today’s annual general meeting in Sydney.

No doubt Balnaves, one of Australia’s most generous philanthropists, will be at pains to stress Ardent is not an emotionless corporate entity.

Additional reporting: Rosanne Barrett