Earthquake-hit Christchurch has become "almost impossible" to market as a holiday destination and its tourism industry faces a grim future, one of the city's major tour operators says.
The number of regional guest nights continues to dive, and Canterbury Leisure Tours chief executive Kevin Edlin says he does not see this changing in the "foreseeable future".
Canterbury lost more than a million guest nights in the year to February 2012 compared with the year ending February 2011, Statistics New Zealand figures show.
Christchurch International Airport had a drop of 7392 holidaying visitors from June 2010 to the same month this year.
Many tourists bypassed the city for other South Island destinations.
Edlin, who has worked in the tourism industry for 20 years, said business was worse than ever .
He had experienced a 90 per cent loss in the European tourist market since the February 2011 quake.
The prospect of recovery in the short-to-medium term was "not good".
The city offered "very limited" four-star-plus accommodation options, safety concerns about aftershocks were "impossible to extinguish", long-haul markets faced a difficult economic climate and because of "excellent exchange rates and low-cost carriers", Australian travellers were opting to holiday elsewhere, Edlin said.
"New Zealand is not as desirable as it was.
"Coupled with the lack of accommodation and safety concerns, Christchurch becomes almost impossible to market as an international destination for visitors," he said.
Christchurch & Canterbury Tourism chief executive Tim Hunter was aware of the "desperate" situation and said an international campaign working on Christchurch's image would be launched this year.
"We need to rehabilitate our image.
"We need to let people know we are not a city being constantly impacted by quakes.
"We work and play and talk at the time of the quakes and there is a lot more quirky and interesting stuff happening in our city that people need to know about," Hunter said.
The squeeze on the tourism industry was being felt across the South Island, but Christchurch had been hit hardest, he said.
At least 60 per cent of South Island bus tours would bypass Christchurch for a second summer in a row this year and tourism operators had been forced to "cut costs radically, let staff go and run on very low volumes for quite a long time".
He said the city "desperately needs some hotels", but there was no quick fix.
Canterbury Employers' Chamber of Commerce chief executive Peter Townsend said it was critical to change "the misperception that Christchurch was still a dangerous place".
"We need to do everything we can to encourage tourists back into Christchurch and to demonstrate to the world that we are still up and running," he said.
Townsend said moves were under way to resolve the city's lack of accommodation and central-city hotels were being repaired.
He hoped a $14-million extension to Wigram's Air Force Museum would attract convention tourists back to Christchurch.
Big change in accommodation clientele
Christchurch motels and backpackers have seen a dramatic shift in clientele since the earthquakes.
Families awaiting repairs on quake-damaged homes, businessmen who would usually have stayed in hotels and rebuild workers have kept many accommodation suppliers afloat for the past
Noriko Stoutjesdijk, the owner of Kiwihouse Hostel Backpackers, said 80 per cent of her current bookings were from construction workers from Australia and Ireland. Some were Kiwis from other parts of the country.
Before the February 2011 earthquake, the Gloucester St backpackers housed many German, French and Asian tourists, but Stoutjesdijk said the clientele had changed "dramatically" since.
"The numbers have gone down a lot and we don't see anywhere near as many Asian people or tourists any more," she said.
Some city motels reported a 50 per cent drop in business compared with pre-quake days.