The World Travel and Tourism Council (WTTC) published ‘2007 China travel and tourism economic research.’ This shows that in 2007, China’s personal travel expenses are expected to reach approximately RMB900 billion. By 2017 it estimates China’s personal travel expenses will reach RMB3.5 trillion. This, of course, is a guesstimate but it does show the size of the potential market, potential profits and potential problems.

Last year, the number of overseas tourists in China amounted to approximately 50 million. The number of tourists traveling abroad reached about 35 million and the number of domestic tourists was about 1.4 billion.

China has become a traveling destination and at some point in the future, probably within ten years, it will be the world’s most popular tourist destination.
Source: People’s Daily Online

According to the Beijing Municipal Bureau of Statistics China’s inbound tourism industry is growing much faster than expected in some areas. The results of a recent study indicate that over the first five months of 2007, Beijing received over 1.6 million international tourists, up 11.8% on the same period last year. Which is why all of those hotels keep opening.

The bureau said the main source markets for international tourists into Beijing were Japan, the US and South Korea.

Meanwhile, statistics show Tibet received a record 672,000 domestic tourists and 45,000 international tourists over the first five months of the year – an 82% increase on 2006 figures. According to the regional tourism bureau, tourists contributed RMB636 million ($83.5 million) to the economy over this period, up 78%.
Source: TTG

Bruce Bommarito, vice president of international market development for the Travel Industry Association in the United States said of the tourist market from China to the USA and shown on the right, said, ‘In the next 10 years, it will probably dwarf any overseas market we may have, with the potential to dwarf all overseas markets combined.’

The number of Chinese who travel outside their homeland each year is expected to nearly triple to 100-million by 2020, and American cities and businesses are positioning themselves to profit from what they hope will be a tourist boom. They are establishing offices in China and lobbying the government to ease restrictions on travel to the United States.

While the number of Chinese visitors has been increasing as yet it is not a flood. Far from it. 320, 000 Chinese — 1.5% of overseas visitors — traveled to the United States in 2006. Of the Chinese who left the mainland, fewer than one in 100 headed for the United States. But many American entrepreneurs think that number could soon explode.

Rising disposable income has made travel an increasingly attainable luxury, and one that is often viewed as a status symbol.
Source: St Petersburg Times

A growing interest in tourism among Chinese who have seen their incomes rise while travel restrictions have lessened could bring a fortune to hotels, tour companies and attractions around the United States.

The number of Chinese who travel outside their homeland each year is expected to nearly triple to 100 million people by 2020. American cities and businesses are positioning themselves to profit from what they hope will be a tourist boom. They are establishing offices in China, and lobbying the government to ease restrictions on travel to the U.S.

Bruce Bommarito, vice president of international market development for the Travel Industry Association, said, ‘In the next 10 years, it will probably dwarf any overseas market we may have, with the potential to dwarf all overseas markets combined.’

It has a lot of growing to do. 320,000 Chinese — 1.5% of all overseas visitors — traveled to the U.S in 2006. Many American entrepreneurs believe that number could soon explode.

Noel Irwin Hentschel, CEO of tour operator AmericanTours International, said China will be her company’s top business focus in the coming decades. She predicted that by 2009 Chinese tourists will account for one-tenth of the roughly 1 million customers her company ferries around the United States each year.

In 2004, Nevada became the first non-nation to win approval from the Chinese government to open a tourism office there and advertise directly to the Chinese public. Los Angeles, San Francisco and Hawaii have since won permission to open offices or hire representatives. And New York hopes to in the near future.
Source: Daily Herald Chicago

A United Nations World Tourism Organization (UNWTO) official has stated that China is likely to replace the United States as the world’s third most popular tourism destination next year. At present, China ranks fourth, after France, Spain and the United States.

Last year, China accounted for 5.8% of the global tourism market. And 29% of tourists who traveled to Asia and the Pacific last year also visited China.

Xu Jing, regional representative for Asia and the Pacific of UNWTO, said the market share percentages of China and the U.S. last year were very close. He said, ‘I am confident China will overtake the US next year.’

UNWTO forecast last year that China would become the most popular destination by the year 2020. At the beginning of this year, it revised its forecast to 2015. Xu said the forecast was revised because of the rapid development of the country’s tourism industry.

The number of overseas travelers to China has increased from 10.5 million in 1996 to 49 million in 2006. The 2008 Summer Olympics in Beijing and the 2010 World Expo in Shanghai will further boost China’s tourism market.
Source: China View

China National Tourism Administration wants to comprehensively develop domestic tourism and boost inbound tourism in line with the 11th Five-Year Plan. The goal is 68.8 million inbound overnight tourists and 1.78 billion domestic tourists with a total tourism income of RMB1,216 billion (US$156.5 billion).

One trade forecast is that the tourism industry in China will have an average annual growth rate of 10.4% in the next ten years. This rapid growth of the tourism industry has led to the increasing prosperity of hotels and subsidiary industries.

By the end of 2005, there were 12,930 star-level hotels in China with a year-on-year rate of growth of 18.75%. There were 1.37 million hotel rooms — an increase of 10.67%.
Source: Travel Daily News

Liu Kezhi, a senior official with the China National Tourism Administration, says that China can expect to earn $156.5 billion from tourism in 2010.

The number of foreign tourists who will spend at least one night in China is expected to jump to 68.8 million in 2010 with domestic tourists expected to take 1.78 billion overnight trips. Add those two figures together and you get a minimum of 2.47 billion room nights. Which is why hotels are springing up like mushrooms.

Last year presaged what is to come. Both the number of tourists and the money they spent hit record highs last year. China’s travel industry catered to 1.363 billion tourists last year, up 10 percent, while tourism revenue hit $97.8 billion, a year-on-year growth of 12.4 percent.
Source: Xinhua

Global hotel chains are increasingly targeting booming emerging economies for expansion, with China and India set to become major battlefields for future growth. This according to PriceWaterhouseCoopers in a report.

Part of the problem is that most other places are pretty well supplied. The report states:

‘As emerging markets turn into the growth engines of the 21st century, slower growth at home has led investors and hotel companies to pursue aggressive expansion abroad … China in particular has become one such battleground for operating system power.’

The InterContinental Hotels group, which owns the Crowne Plaza and Holiday Inn brands, has, for instance, announced a goal of 125 hotels in China by 2008.

French hotel group Accor, owner of the Sofitel brand and several others, plans to open 200,000 new rooms by 2010 in China plus other emerging markets.

India has a long way to go to catch up with China. India is estimated to have just 92,000 hotel rooms, compared with 135,000 in Shanghai alone.

There will also be huge growth in outbound travel from emerging nations, PWC said, adding China had already become the largest source of travellers within Asia.

Within 15 years, the number of Chinese overseas travellers is expected to rise tenfold to 100 million.

The report said:

‘The owners of globally recognized brands hope familiarity with these brands within emerging markets will … allow them to leverage the brands’ strength and drive business as these new travelers come to the more mature markets of Europe and the United States.’

Which, in truth, seems a bit of wishful thinking.
Source: Reuters

Lodging Econometrics, a company that pronounces on hotel real estate, has just completed a three year forecast for new hotel openings.

China has the largest development projects in the region, and is second globally only to the United States. China has 316 projects and 107,725 guestrooms planned. The room count is a 63 percent of the total rooms in the entire Asian pipeline. Development is fast -tracked everywhere as many major cities in China are presently ‘under roomed’.

By the end of ’06 China will have grown to be the fourth largest tourist destination in the world. It expects to surpass the U.S. and become number one during the next decade. As the Chinese middle class is increasingly benefiting from the expanding economy, China’s native tourist travel is growing impressively as well.

Beijing has the fastest pace which is 36 projects with 11,288 guestrooms. Seven hotels are scheduled to open in the 4th quarter, an additional 10 in ’07 and 12 in early ’08. Lodging Econometric’s president, Patrick Ford, said, ‘Their development pace is geared to getting ready for the Olympic Games which will be held in Beijing in the summer of ’08.’

Shanghai, with 43 projects and 13,957 guestrooms, is even larger but the new openings will be spaced more evenly over the decade; 15 through ’07, 14 in ’08 and another 14 in ’09 and beyond. Shanghai’s pipeline is timed for the World Expo that it will host in 2010.

Another six cities — Tianjin, Guangzhou, Ningbo, Chengdu, Shenzhen and Sanya — combine for a total of 66 projects being worked on. Two-thirds, or 44 projects, are under construction.
Source: Lodging Intelligence

The HotelBenchmark Survey by Deloitte shows that hotels in China have seen strong growth during the first eight months of 2006 as revenue per available room (revPAR) increased 8.7 percent. Average room rates have been the driving force behind this growth and are now US$10 higher than the same period in 2005, at US$111. All cities tracked across China saw increases in average room rates over the period.

Will this go on?

One indicator is that for the second consecutive year, China remained in the World Tourism Organisation’s Top Destinations list in terms of international tourist arrivals. With 46.8m arrivals during 2005, China ranks in fourth position behind France, Spain and the US.

Lorna Clarke, Executive Director of HotelBenchmark said: ‘2006 promises to be another good year for hotel performance in China. Although revPAR growth for the first eight months of 2006 has been slower than the 14.3 percent achieved in 2005, it is still impressive. Going forward China will continue to challenge other destinations, last year the country ousted Germany from the number six spot in terms of tourism receipts and it needs just 2.6m more visitors before its level pegging with the US.’

So, yes, hotel average room rates will continue to rise until demand slows. That will not happen until after the 2008 Olympics.

Source: Hotel Benchmark