8 April 2026: Queensland’s tourism industry is facing a critical turning point, with rising fuel costs and mounting operational pressures pushing businesses to the brink and increasing concern across the sector about what lies ahead.
The Queensland Tourism Industry Council (QTIC) has written to both State and Commonwealth Governments today, calling for immediate, coordinated intervention to stabilise the visitor economy as industry conditions deteriorate.
QTIC CEO Natassia Wheeler said that while the Easter period delivered strong visitation, the underlying outlook for many operators is increasingly fragile.
New data shows accommodation occupancy increased significantly across many regions over Easter, including the Sunshine Coast (+41.84%), Whitsundays (+49.99%), Tropical North Queensland (+31.32%) and Outback Queensland (+31.49%).
“Easter delivered strong results across much of the state, with occupancy up year on year and clear evidence that Australians still have a strong appetite to travel,” Wheeler said.
“Queensland, particularly at this time of year, remains one of the most compelling destinations in the country.
“But while the headline numbers are positive, they don’t tell the full story – and our focus has already shifted to what’s coming next.”
QTIC said strong occupancy is no longer translating into sustainable profitability, with operators absorbing escalating costs across fuel, insurance, energy and labour.
A policy briefing provided to government warns fuel price escalation is now acting as the tipping point in a decade of cumulative pressure, pushing otherwise viable businesses into distress.
“We are seeing a widening gap between activity and viability,” Wheeler said.
“Businesses can be busy, but not profitable. They are working harder than ever, with less return, and that is simply not sustainable over time.”
Wheeler said conditions are also increasingly uneven across the state, with geography playing a major role in how businesses are being impacted.
The story is very different depending on where you are operating,” she said.
“South East Queensland is in a relatively stronger position, supported by a large population base that can travel more easily and get more value from a tank of fuel.
“But in the Outback and Far North Queensland, the challenges are much more pronounced. These regions rely heavily on long-haul drive and aviation markets, making them far more exposed to fuel costs and changes in travel behaviour.
“They have also been dealing with the after-effects of recent flooding and weather events, which has impacted recovery, confidence and forward bookings.
“What we are seeing is a growing divide across the state – where some regions are holding up, while others are already feeling the full weight of these pressures.”
Industry feedback collected by QTIC highlights growing concern across multiple parts of the tourism sector.
A Queensland car rental operator reported a drop-off in international inbound customers, particularly long-haul travellers from Europe, traditionally a strong market in April, alongside increasingly shorter booking windows as customers delay decisions due to uncertainty around fuel costs and availability.
“There is increasing hesitation in the market,” Wheeler said.
“People are waiting longer to book, and that uncertainty is flowing directly through to operators.”
The operator also warned that any escalation in fuel supply concerns, including rationing or disruption, would force parts of their business into hibernation.
Marine-based tourism operators are also raising alarm ahead of the upcoming whale watching season, with serious concerns about fuel availability and pricing.
“For marine operators, fuel is fundamental to whether they can operate at all,” Wheeler said.
“With peak season approaching, any disruption to supply has immediate and serious implications.”
In more remote parts of the state, operators are facing compounding challenges.
Island resorts and tourism businesses are reporting difficulty attracting staff due to rising flight costs, alongside increased expenses associated with freight and essential supplies.
“These businesses are dealing with higher costs at every step – from getting staff in, to keeping their operations running day to day,” Wheeler said.
At the same time, some regions are already experiencing a downturn in forward bookings.
Operators in areas such as the Daintree have reported cancellations across the Easter and school holiday period, while one outback caravan park has recorded 204 cancellations for May alone – representing a loss of more than $52,000 in forward revenue.
“Those are significant impacts for regional businesses,” Wheeler said.
“That is the difference between a sustainable trading period and a very difficult one.”
QTIC said these signals reflect early-stage contraction patterns, with softening forward bookings, tightening cashflow and declining business confidence.
“Fuel is the tip of the iceberg. It’s the most visible pressure right now, but underneath that are structural challenges that have been building for years,” Wheeler said.
QTIC is calling for a targeted, time-limited stabilisation package focused on immediate cost relief and restoring confidence across the sector.
Key measures include:
- Targeted cost relief for tourism businesses, including payroll tax, permits and regulatory fees
- Coordinated action to stabilise fuel and aviation costs
- Establishment of a joint State/Commonwealth tourism fuel impact taskforce
- Clear national guidance to maintain consumer confidence around pricing and surcharges
“This is not a short-term disruption – it is a structural cost challenge that requires a coordinated response,” Wheeler said.
“The risk is not just a slowdown in growth. The risk is a contraction in industry capacity at the very time Queensland is preparing for 2032 and beyond.”
QTIC will continue to work closely with industry and government, with a proposed roundtable and coordinated response framework targeted within the next 60 days.
“We know the demand is there,” Wheeler said.
“The question now is whether we act quickly enough to ensure the industry is still there to meet it.”
ENDS.
For more information, images and interviews please contact Heather or Jen at The Comms. People:
Heather Mollins | 0412421411 | heather@commspeople.au
Jennifer Swaine | 0438952830 | jen@commspeople.au