China Regains Luxury Appetite But Travel Budgets Stagnate

In 2016, Chinese luxury spend increased 20 per cent and returned to pre-2013 levels, according to chairman and chief researcher of the Hurun Report Rupert Hoogewerf, but buyers interviewed at ILTM Asia say this is not translating to fatter holiday budgets.

Hurun’s 2017 The Chinese Luxury Traveller Report states that purchasing power of respondents rose 57 per cent, from RMB14 million (US$2.1 million) per capita in 2015 to RMB22 million, as the effects of China’s 2013 anti-corruption measures ease.

Last year also saw the highest average willingness to spend extravagantly on accommodation, Hoogewerf said, with 60 per cent of wealthy Chinese travellers spending at least US$500 per night on rooms – although average household travel expenditure was relatively unchanged at RMB380,000.

Speaking to TTG Asia at ILTM Asia, Wang Ze Lin, outbound director of Resort Saloon, an agency operating under China Environment International Travel Service, observed a dip in Chinese travel spend in the past year.

In 2014 and 2015, the company’s bookings for resort destinations such as the Maldives, Mauritius, Fiji and Tahiti were typically for five-star or five-star plus properties. But from 2016, the trend turned towards four-star properties, said Wang, citing the possible effects of slowing economic growth.

On the other hand, senior trip consultant at Deep Blue Trip, Eric Lee, has seen travel budgets grow in the past year due to a preference for smaller groups, personal vehicle and guide, and better quality services.

Meanwhile, assistant general manager of CYTS Sparkle Tour, Aymeric Naudin, pointed out that Chinese luxury travellers prioritise their spend differently depending on what part of the world they are visiting.

In Europe, “accommodation is generally not the primary allocation” as Chinese travellers prefer to splash out on activities, meals and shopping, said Naudin.

“In Asia, the budget for accommodation is very important. It’s all about affording a great resort with (ample amenities) as Chinese travellers (tend to) spend most time privately with their family in a villa.”

Source: As reported by Yixin Ng from ILTM Asia, Shanghai, 08 June 2014

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