Newfoundland and Labrador Product Development Strategy

- 61 -and Labrador has been most affected, along with access from St. John’s to Deer Lake. Aswell, the equipment used has been small turbo-props with limited capacity. The situation hasimproved somewhat with the recent announcement by CanJet that they will be offeringservice between Deer Lake and St. John’s on a daily (or almost daily) basis.Tour operators have indicated that the realities of intra-provincial air access (capacity,equipment and prices) make it virtually impossible for them to offer open-jaw itineraries (forexample, fly to Deer Lake, drive to St. Anthony, fly to St. John’s and then back home). As aresult, the types of tour programs offered in the province have not evolved as they might haveto respond to emerging market interests in shorter trips, more in-depth experiences and nicheproducts.Car RentalsCar rentals are another transportation challenge facing the tourism industry in Newfoundlandand Labrador. As with many of the other challenges, it is the highly seasonal nature ofdemand that is at the root of the problem. Problems with car rentals were identified byconsumers, by tour operators and by tourism industry representatives. Specific challengesinclude:o Capacity of the rental car fleet during the tourist season, particularly in St. John’s butalso in other locations. While tourism activity has grown significantly in the past fiveyears, it appears that the rental car fleet has not kept pace.o Costs of car rentals, in particular mileage charges and drop charges for one-wayrentals. While it is possible to get unlimited mileage car rentals (e.g. with use ofcorporate cards, an Aeroplan card, etc.) this is not well known by pleasure travellers.High drop charges (and in some cases being permitted to drop off at all) are aparticular problem with lengthy travel distances between popular destination areas. Itis also impossible to rent in province and drop off outside Newfoundland andLabrador or vice versa.o Availability of car rentals in selected locations – for example, there are no car rentaloutlets in Port aux Basques making it impossible for someone to travel over on theferry and pick up a car on arrival.The limited availability of rental cars, and the pricing, is another factor constraining thegrowth in FIT travel into the province.We understand that many of the car rental agencies in Newfoundland and Labrador are localfranchisees not corporate offices, and are therefore self-contained businesses. Whereascorporate offices are able to relocate cars to different areas to help accommodate peaks andvalleys in the supply/demand mix, this is not an option for franchisees. Hence, addressingthe capacity issue in the summer by increasing the size of the fleet will create an oversupplyproblem in the winter. Long travel distances and poor roads further exacerbate the situationby increasing the level of wear and tear on vehicles.THE ECONOMIC PLANNING GROUP of Canada Newfoundland & Labrador Tourism Product DevelopmentD. W. Knight Associates Strategy and Accommodation Needs Study