The global travel industry is set for a period of sustained growth over the next decade, driven in part by China’s share of global outbound travel reaching as much as 20% by 2023.
A global travel trends study predicts an optimistic macro-economic outlook for global travel over the next 10 years, with the industry projected to outstrip global GDP by some 2% – growing 5.4% a year.
China’s growth in outbound travel, which as recently as 2005 stood at just 1%, will enable it to overtake the U.S to become the world’s largest outbound travel market this year, with the number of Chinese households able to afford overseas travel set to more than double in the next 10 years.
China will also become the biggest domestic travel market by 2017, driven largely by rapidly increasing GDP, rising employment levels and higher consumer spending.
However, the report by global forecasting group Oxford Economics for Amadeus indicates that growth will not be exclusive to China, with forecasts showing that other large emerging markets such as Russia, Brazil, India, Indonesia and Turkey will each also average more than 5% annual growth over the next decade.
This will be driven largely by rising wealth and changing consumer habits.
Air travel growth will be led by emerging economies such as India, Indonesia and Russia, as non-OECD air travel is set to overtake that of OECD members for the first time, to become largest source of global air traffic by 2023.
Demand for international hotel stays has outpaced demand for domestic stays since the recession, suggesting reduced domestic hotel spending is the new normal. At the same time, overnight visitor flows for Asia are set to grow nearly four times faster than Europe’s over the next ten years – but Europe will remain dominant.
Business travel will bounce back as links between East and West stimulate new demand, but western short-haul business travel will not reach pre-2008 levels until 2018, according to the Shaping the Future of Travel report . Asia will account for 55% of global business travel growth in the next ten years.
Amadeus distribution senior vice president Holger Taubmann said: “Forecasts predict a new golden era for travel, which will be welcome news for many segments of the industry that are only just beginning to emerge from recession.
“However, as the complexities in the business travel market clearly demonstrate, growth will be far from evenly distributed and there are likely to be both winners and losers.”
Report author Andrew Tessler, associate director at Oxford Economics, said: “The global travel industry is gaining strength and changing as it emerges from the recent recession in developed countries.
“China’s development is an important driver but there are actually many more subtle factors also at play. Shifting competitive dynamics and the persistence of new behaviours that emerged during the recession are both impacting key indicators in the sector.”