Long Beach is estimated to lose more than $50 million for the months of March and April as the Acura Grand Prix of Long Beach, major conventions and other events have been canceled in the wake of coronavirus concerns.
The Grand Prix alone brings in an estimated $32 million to the city. That loss is in addition to another $25 million lost in canceled conventions and hotel events, according to Steve Goodling, president of the Long Beach Area Convention & Visitors Bureau.
“This is a very big impact and we will definitely feel it moving forward,” Goodling said Thursday.
The concern prompted Mayor Robert Garcia other city officials to meet with hotel operators and other business leaders on Friday afternoon. Garcia in an interview said the city will consider an “everything on the table” approach, including looking at reducing fees and taxes to help local businesses.
“There’s a huge economic impact for small businesses, and once we get past this initial handling of the health crisis we’re going to have to deal with the economic challenges,” he said.
In March alone, five major conventions were canceled or postponed, resulting in thousands of hotel room night cancellations. All told, about 24,000 room nights have been canceled, not counting the future impact of the Grand Prix, officials said.
The Grand Prix, the city’s largest event, was canceled Thursday along with a string of other major events in Long Beach through April as the state moved to cancel or postpone events with 250 or more people.
It was expected to draw roughly 185,000 people to Downtown on April 17-19. The Grand Prix Association of Long Beach in a statement said it is in conversations with the city and various race sanctioning bodies to “discuss the viability of rescheduling this event at a later time in the year.”
A report released in 2018 from Beacon Economics showed that the 2017 Toyota Grand Prix brought in $32.4 million for the Long Beach economy and $63.4 million for Southern California.
The Grand Prix supports 606 year-round jobs, with 351 of those in Long Beach, the economic impact report found. It also generates $1.8 million in overall tax revenue, including $700,000 in Long Beach.
The economic impact will also hit restaurants, vendors and other businesses who depend on the Grand Prix each year for a boost in sales.
Managers at some of the city’s largest hotels say they’re already feeling the brunt. Swietlana Cahill, general manager for the Hilton Long Beach, said the recent drop in visitors has hit all hotels.
“We’re staying focused on the positive, but obviously the entire city has been impacted,” she said.
The impact can also be felt at the ports of Long Beach and Los Angeles as cargo numbers continue to drop due to lack of imports from China, where the virus was first discovered.
The Port of Long Beach, the nation’s second busiest port, saw cargo volume drop by 9% last month, while the Port of Los Angeles saw a 22.9% decrease compared to last year.
The lack of cargo means little available work for longshoreman, rail operators and truck drivers.
Elizabeth Ramirez, an office manager for RPM Harbor Services, a trucking company near the Port of Long Beach, said her company has seen about a 70% decrease in the amount of cargo its moving compared to busier times. She said work for independent truck drivers has been especially scarce.
“We’re trying to do what we can,” she said. “It’s definitely impacting a lot of people here in the industry.”
But it wasn’t all bad news for businesses. The Long Beach-based www.freeconferencecall.com saw its busiest day on Thursday since it was founded 20 years ago, said CEO Dave Erickson.
Erickson said the company has seen a major boon in business as a result of many workers being told to work remotely. It is also working closely with hospitals, government entities and healthcare organizations around the world to share information.
The company typically sees about 4,000 to 5,000 sign-ups for conference calls a day. As of 3 p.m on Thursday, it had hit 11,000 signups.
Erickson said the company has no call time limits and can connect up to 1,000 callers in one session.
“So in addition to providing peace of mind to geographically dispersed groups and supporting remote work to keep the economy going, we can also deliver some really essential services to those at the front lines of handling this global crisis,” he said.
Goodling said he expects the conventions to return in the fall, but it will be difficult to make up for the losses moving forward since most dates are already booked.
For now, the Convention and Visitors Bureau is planning a “Staycation” marketing campaign in the hopes that local travel will pick up in the summertime as people may be wary of traveling overseas.
The bureau is also working with local restaurants on a local dining campaign to support small businesses, he said, adding that small businesses will be hit especially hard.
“Our next hope is that summer travel will be strong and we believe it will be if the virus can be contained,” he said.