The global travel industry is entering a “golden decade” during which Asia will account for 55 per cent of worldwide travel growth, according to a report.
Overnight trips will increase by 5.4 per cent per annum over the next ten years, a study by advanced travel solution provider Amadeus and Oxford Economics has revealed.
The report projects that China will overtake the US as the largest source of outbound travel spend in 2014, rising from 1 per cent in 2005 to 20 per cent in 2023. It will also become the biggest domestic travel market by 2017.
In terms of regions as a whole, Asia-Pacific, the Middle East and Africa will be the fastest growing.
From 2013 to 2023, visitor flows for Asia are forecast to grow at an annual average rate of 15.1 per cent, almost double the rate in the ten years prior. In the next decade, visitor flows from the Middle East and Africa will grow at an annual rate of 11.9 per cent.
Holger Taubmann, senior vice-president of distribution at Amadeus, 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.”
The report also highlights Russia, Brazil, India, Indonesia and Turkey as large emerging markets, with average annual growth of more than 5 per cent each expected for the next decade.
This is explained by “rising wealth and changing consumer habits, expanding their international air traffic flows and outbound travel expenditure”.
In terms of travel spend, the report forecasts Russia’s to rise from about US$50 billion in 2013 to more than US$100 billion in 2023. Similarly, Brazil’s is anticipated to double, and India and Indonesia’s to roughly treble.
The report found that Western spending habits have, on the other hand, adjusted to austerity: “Business travel expenditure by US and European passengers is not forecast to reach pre-recession levels until [sometime in] 2014 and 2018 respectively.
“This is in stark contrast to Asia, where trend growth in business travel expenditure was unaffected by the financial crisis.”
European business travellers are expected to account for 15 per cent of future global revenue growth over the next decade, while North Americans will be 7 per cent. In north-east Asia, corporate flyers will account for 42 per cent of the growth in global outbound business travel expenditure, with south-east Asians accounting for 13 per cent.
In Europe and North America, short-haul corporate travel will not return to 2008 rates until 2018, though intercontinental premium traffic “recovered quickly and robustly from the financial crisis”.
Low-cost carriers (LCCs) in Europe transport 250 million passengers per year, while North America moves 173 million, but Asia is catching up, with an annual average of 117 million passengers.
The report reads: “The introduction of large numbers of new middle-class travellers from emerging economies in the next ten years will pose great opportunities for LCCs.
“LCCs, however, are yet to demonstrate a viable model for capturing longer-haul market share. The more successful LCCs become, the more likely they are to outgrow their original business model and be forced to adapt.”
In terms of international hotel nights, over the next decade, the growth rate in Europe will increase to 3.2 per cent, from 1.5 per cent between 2002 and 2012, while in the Americas it will be 6.1 per cent, up from 5.1 per cent.
Visit amadeus.com to read the full report.