InterContinental Hotels Group (IHG) has partnered with Oxford Economics to publish one of the most comprehensive studies into the Chinese travel market ever undertaken.
The report, released to coincide with the 2015 International Hotel Investment Forum (IHIF) this week at the Hotel InterContinental Berlin, Germany, reveals the scale of the opportunity for global travel destinations to benefit from shifting patterns in Chinese travel, with London, New York, Los Angeles, Sydney and Tokyo expected to benefit most.
Published today (Mar 3), ‘The Future of Chinese Travel’ report shows that favourable economic and demographic trends shaping the Chinese travel market are set to fuel huge increases in demand for international travel over the next decade.
It also reveals the opportunities this growth will present, as Chinese traveller preferences evolve towards long-haul, leisure-driven travel.
The study reports that increases in leisure and retail spend will contribute to significant increases in the value of Chinese travellers to local economies.
“This is a ground-breaking piece of research, which demonstrates the sheer scale of the ‘China outbound’ opportunity for cities and local economies worldwide,” said IHG’s Chief Executive Officer, Richard Solomons.
“With the shift towards leisure travel, coupled with the 90 million Chinese households able to take long-haul trips by 2023, the country’s growing importance in the global travel market cannot be underestimated.
“With 30 years of experience in China, the recent launch of our new Chinese brand, Hualuxe Hotels and Restaurants, and the roll-out of our China Ready programme, IHG is well-placed to meet this growing demand.”
Adam Sacks, President, Oxford Economics, added: “The Future of Chinese Travel Report provides a comprehensive view of Chinese travel and shows that overseas trips will become possible for tens of millions of new Chinese households within the next 10 years.
“History shows that destinations which improve access for Chinese travellers, experience a significant growth premium in the number of arrivals.
“This represents a clear opportunity for both countries and international cities to benefit from the huge future increases in Chinese outbound travel,” he said.
The Future of Chinese Travel report: Key findings
Scale of the opportunity
-88 million Chinese households will be able to travel overseas by 2023
Increase in family income is the key driver behind this change
-In the next decade, over 60 million Chinese households will cross the annual income threshold of $35,000, at which point international travel becomes more affordable
Three key trends in Chinese travel will emerge over the next 10 years:
1. Chinese demand for long-haul travel will experience huge levels of growth
-China will overtake the US, UK and Germany to become the largest source market for long-haul travellers by 2020; and
-As Chinese tourism demand matures, preferences will shift toward more expensive, longer-haul trips.
2. Chinese travellers will mix business with leisure:
-By 2023, nearly two thirds (62%) of total Chinese outbound travel will be leisure-driven – a major shift in the purpose of travel for outbound Chinese away from business
3. Chinese travellers will spend more during overseas trips:
-Per-trip spending by Chinese travellers is expected to grow nearly 75% in nominal terms by 2023; and
-Continuing shift in preferences towards higher-cost accommodation and upscale shopping.
International cities set to benefit most
-Cities are the primary destinations for Chinese outbound travellers, with over 85% heading for major cities around the world;
-Nearly 95% of total Chinese outbound travel spending is received by major global cities;
-Among top destination countries, major cities alone receive almost half of each country’s total Chinese visitors.
Access is key to attracting Chinese tourists
-Destinations with easier access, including simpler visa policies will gain most; and
-Reforms affecting Chinese travel show levels of arrivals to be 20%pts above historical trends
HM flew to Berlin with British Airways. BA flies to Berlin via London and the author recommends flying in Club World (Business Class), which features flat-bed seats, hundreds of hours’ entertainment on demand, a great selection of wine and some of the best meals in the sky. For bookings, visit www.ba.com