China’s tourism market notes significant slowdown
Revenue per available room in the country fell significantly in the second quarter
The Chinese tourism sector reports a general decrease in revenues per available room (RevPAR) within Greater China throughout the second quarter of this year.
Among those seriously hit by the shortfall in travel are Marriott whose RevPAR is down by 4 percent, IHG which is down by 7 percent, and Wyndham which reported a 17 percent drop during the quarter.
During a recent earnings call, Marriott chief financial officer Leeny Oberg remarked that weaker demand and current pricing trends within Greater China may persist well through the rest of 2024, with the greatest RevPAR decline most likely to occur in the third quarter.
Winners and losers
Interestingly, China isn’t the only tourism giant experiencing a major slowdown. The hospitality sector in the United States also saw a slight year-on-year decline in the first half of this year. Right now, average RevPAR remains approximately 5 percent lower than what was seen back in 2019.
India, on the other hand, continues to report steady gains. According to McKinsey’s recent report The State of Tourism and Hospitality, India is now the sixth-largest domestic travel market in the world in terms of spending.
The report pointed out that the current growth of the Indian middle class is the primary factor behind this development. Consequently, travel spending in the country could increase by around 9 percent per annum.
The report also shows that India’s travel sector could outstrip both Japan and Mexico by the end of the current decade, enabling it to become the fourth-largest travel market in the world.
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