Tag Archives: Asia Pacific

Asia Pacific (Excluding China) Hotel Construction Pipeline Hits Record High in Q4 2023

According to the recent Construction Pipeline Trend Report from Lodging Econometrics (LE), the total hotel construction pipeline in the Asia Pacific excluding China (APEC) increased 4% year-over-year (YOY) and closed 2023’s fourth quarter with a record-high 1,977 projects and 402,156 rooms.

At the close of the quarter, projects currently under construction account for 47% of the projects in the region’s total pipeline, with 922 projects/212,607 rooms. Projects scheduled to start construction in the next 12 months increased 8% YOY to stand at 342 projects/65,079 rooms at the Q4 close. Projects in the early planning stage grew 11% YOY and hit an all-time high of 713 projects with 124,470 rooms.

Higher-end chain scale project totals are up in the APEC region at Q4, with luxury, upper upscale, upscale projects and room counts all reaching record highs. Luxury hotel construction projects in the region increased 9% YOY to close the quarter at 241 projects/46,808 rooms. Upper upscale projects grew 12% since Q4 2022 to stand at 370 projects/83,083 rooms, and upscale projects increased 6% YOY to close the fourth quarter with 447 projects/96,730 rooms.

At Q4, countries in the APEC region with the largest pipelines are led by India, which accounts for 26% of the projects in the region’s total pipeline with a record 514 projects/61,075 rooms. Next is Vietnam with 253 projects/88,827 rooms, then Indonesia with 208 projects/34,682 rooms. These countries are followed by Thailand with 155 projects/37,955 rooms and then Japan with 155 projects/30,024 rooms.

Cities in the region with the largest construction pipelines at Q4 2023 are Bangkok, Thailand with 61 projects/14,915 rooms; Jakarta, Indonesia, with 50 projects/9,748 rooms; and Melbourne, Australia, with 45 projects/8,354 rooms. Kuala Lumpur, Malaysia, follows with 36 projects/10,736 rooms, and then Phuket, Thailand, with 36 projects/9,525 rooms.

The APEC region had 357 new hotels/57,470 rooms open in 2023. LE analysts forecast another 381 new hotels with 74,341 rooms to open in 2024 and 379 new hotels with 76,422 rooms to open in 2025

Asia makes a comeback by contributing more than 58% of all IVAs

 

The Pacific Asia Travel Association (PATA) has unveiled the Executive Summary report detailing its latest projections for international visitor arrivals (IVAs) across Asia Pacific. The report indicates robust annual growth in numbers for 2024, with this momentum expected to continue through 2026.

Asia is projected to dominate as a supplier region of IVAs, making a substantial comeback by contributing more than 58% of all IVAs into Asia Pacific in 2024 under each of the three scenarios. America and Europe are expected to follow with shares of approximately 19% and 14%, respectively, during the same year.

Anticipated outcomes suggest that, under the mild scenario, pre-COVID levels of IVAs will be surpassed in 2024, while the medium scenario envisions this achievement in 2025. However, the possibility of a severe scenario remains, forecasting arrival numbers to linger around 13 percentage points below the 2019 benchmark by the end of 2026. Despite this, the growth observed across the Asia Pacific region underscores the significant efforts by destinations in attracting international travellers, emphasising the crucial role of the entire visitor economy in national economic recovery.

Noor Ahmad Hamid, CEO of PATA, commented on the latest forecasts, highlighting the swift recovery of international arrivals in the Asia Pacific region. He noted that the projections indicate strong visitor growth annually from 2024 to 2026 under mild and medium scenarios, driven partly by joint agreements on destination visa requirements.

However, Hamid cautioned against expecting uniform growth across all destinations, emphasising the need for flexibility and preparedness in the face of industry shifts and uncertainties. In absolute terms, the projected number of IVAs for 2024 ranges from a high of 750 million under the mild scenario to 477 million under the severe scenario.

Despite the current scenario conditions, it appears that Asia will maintain a formidable advantage in International Visitor Arrival (IVA) numbers each year from 2024 to 2026, securing over 70% of arrivals into and across the Asia Pacific region. While annual increases in IVA numbers are anticipated during this period, variations exist among the three destination regions and the 39 individual destinations covered in the report, influenced by different scenarios.

By the end of 2026, Asia is forecasted to account for over 61% of all foreign arrivals across Asia Pacific.

Hamid emphasised, “While arrival numbers continue to rise, challenges related to staffing and upholding service excellence remain pivotal concerns for destinations within the region. This is particularly pertinent now, as global competition actively targets the burgeoning source markets within Asia Pacific. Any hint of complacency poses a constant threat and must be diligently avoided.”

Malaysia Airlines eyes code-share with Indian carrier; to expand network in North East & South India

In a bid to strengthen its foothold in the lucrative Indian aviation market, Malaysia Airlines is set to enter into a code-share partnership with an Indian carrier. Captain Izham Ismail, the Group Managing Director of Malaysia Aviation Group, expressed the airline’s enthusiasm for participating in India’s success story.

Currently operating 69 weekly flights to nine Indian cities, including Delhi, Mumbai, and Bengaluru, Malaysia Airlines is eyeing further expansion in both the North East and South India. The airline recently increased its weekly flights on the Amritsar-Kuala Lumpur route and is actively engaged in negotiations for a comprehensive codeshare agreement with an undisclosed Indian airline.

The forthcoming collaboration aims to enhance connectivity and provide seamless travel experiences for passengers. The airline, having successfully undergone financial restructuring, is now on a path to revival and growth.

Captain Ismail shared insights into the airline’s future plans, indicating a keen interest in North East destinations like Guwahati and Kolkata, along with potential flights to Trichy, Visakhapatnam, and Goa in South India. The expansion will be facilitated by the introduction of new Boeing 737-8s and Airbus 330 neos to the airline’s existing fleet of 100 planes, with projections to reach 170 by 2030.

Acknowledging the rapid growth of India’s aviation market, Captain Ismail emphasised the importance of strategic partnerships in the face of competition from domestic carriers like IndiGo and Air India. Malaysia Airlines has a history of successful partnerships with airlines such as Japan Airlines, Cathay Pacific, and Qatar Airways.

The overarching goal for Malaysia Airlines is to be among the top 10 global airlines and the top 5 in the Asia Pacific region. Captain Ismail emphasized the airline’s commitment to providing an enhanced Customer Value Proposition (CVP), focusing on upgrading services, cabin comfort, and in-flight dining to cater to India’s diverse population.

With India’s annual domestic air passenger traffic projected to double to around 300 million by 2030, Malaysia Airlines is positioning itself to tap into the immense potential of this dynamic market. The strategic moves underscore the airline’s ambition to play a significant role in shaping the future of air travel in the region.

 

Air Travel Reaches 99% of 2019 Levels as Recovery Continues in November: IATA

The International Air Transport Association (IATA) released data for November 2023 air travel performance indicating that air travel demand topped 99% of 2019 levels.

Total traffic in November 2023 (measured in revenue passenger kilometers or RPKs) rose 29.7% compared to November 2022. Globally, traffic is now at 99.1% of November 2019 levels.

International traffic rose 26.4% versus November 2022. The Asia-Pacific region continued to report the strongest year-over-year results (+63.8%) with all regions showing improvement compared to the prior year. November 2023 international RPKs reached 94.5% of November 2019 levels.

Domestic traffic for November 2023 was up 34.8% compared to November 2022. Total November 2023 domestic traffic was 6.7% above the November 2019 level. Growth was particularly strong in China (+272%) as it recovered from the COVID travel restrictions that were still in place a year ago. US domestic travel, benefitting from strong Thanksgiving holidays demand, reached a new high, expanding +9.1% over November 2019.

“We are moving ever closer to surpassing the 2019 peak year for air travel. Economic headwinds are not deterring people from taking to the skies. International travel remains 5.5% below pre-pandemic levels but that gap is rapidly closing. And domestic markets have been above their pre-pandemic levels continuously since April,” said Willie Walsh, IATA’s Director General.

Asia-Pacific airlines had a 63.8% rise in November traffic compared to November 2022, which was the strongest year-over-year rate among the regions. Capacity rose 58.0% and the load factor was up 2.9 percentage points to 82.6%.

European carriers’ November traffic climbed 14.8% versus November 2022. Capacity increased 15.2%, and load factor declined 0.3 percentage points to 83.3%.

Middle Eastern airlines saw an 18.6% traffic rise in November compared to November 2022. November capacity increased 19.0% versus the year-ago period, and load factor fell 0.2 percentage points to 77.4%.

North American carriers experienced a 14.3% traffic rise in November versus the 2022 period. Capacity increased 16.3%, and load factor fell 1.4 percentage points to 80.0%.

Latin American airlines’ November traffic rose 20.0% compared to the same month in 2022. November capacity climbed 17.7% and load factor increased 1.7 percentage points to 84.9%, the highest of any region.

African airlines had a 22.1% rise in November RPKs versus a year ago. November 2023 capacity was up 29.6% and load factor fell 4.3 percentage points to 69.7%, the lowest among regions.

“Aviation’s rapid recovery from COVID demonstrates just how important flying is to people and to businesses. In parallel to aviation’s recovery, governments recognized the urgency of transitioning from jet fuel to Sustainable Aviation Fuel (SAF) for aviation’s decarbonization. The Third Conference on Aviation Alternative Fuels (CAAF/3) in November saw governments agree that we should see 5% carbon savings by 2030 from SAF. This was followed up at COP28 in December where governments agreed that we need a broad transition from fossil fuels to avoid the worst effects of climate change. Airlines don’t need convincing. They agreed to achieve net zero carbon emissions by 2050 and every drop of SAF ever made in that effort has been bought and used. There simply is not enough SAF being produced. So we look to 2024 to be the year when governments follow-up on their own declarations and finally deliver comprehensive policy measures to incentivize the rapid scaling-up of SAF production,” said Walsh.

T&T deals globally plunge 31.9% in 2023: GlobalData

Global travel and tourism sector witnessed the announcement of a total of 723 deals (mergers & acquisitions (M&A), private equity (PE), and venture capital (VC)) during 2023, a decline of 31.9% compared to the 1,062 deals announced during the previous year, according to data and analytics company, GlobalData.

An analysis of GlobalData’s Deals Database reveals that all the deal types under the coverage witnessed notable decline in volume during 2023 compared to the previous year.

While the volume for M&A deals fell by 32.8%, the number of PE and VC deals were down by 40% and 27.9%, respectively, during 2023 compared to 2022.

Aurojyoti Bose, Lead Analyst at GlobalData, said, “Several factors were at play for the subdued deal activity across several sectors and the travel and tourism sector was not an exception to this global trend. Notable among these factors include the ongoing geopolitical tensions, conflicts, fears of recession, inflation and interest rate hikes.”
North America, Europe, Asia-Pacific, Middle East and Africa and South and Central America regions recorded decline in deals volume by 42.1%, 35.9%, 14.2%, 23.3% and 48.3%, respectively, during 2023 compared to the previous year.

Meanwhile, deal volume also declined in several leading economies including the US (43.3%), the UK (29.7%), China (10%), Japan (41.8%), France (19.4%), South Korea (20%), Australia (37.1%), Spain (57.9%) and Canada (21.1%) during 2023 compared to 2022.

Travel & tourism sector deal activity down by 32.7% YoY during Jan-Nov: GlobalData

A total of 666 deals (mergers & acquisitions (M&A), private equity and venture financing) were announced in the travel and tourism sector globally during January-November 2023, which is a year-on-year (YoY) decline of 32.7% compared to the announcement of 989 deals during the same period in the previous year, finds GlobalData, a leading data and analytics company.

Aurojyoti Bose, Lead Analyst at GlobalData, said, “The global travel and tourism sector persistently exhibited a declining trend in deal activity throughout the year. Geo-political tensions, ongoing wars and associated macroeconomic challenges largely affected the deal-making sentiments in the sector.”

An analysis of GlobalData’s Financial Deals Database reveals that the deal activity within the travel and tourism sector for all the regions and most of the countries suffered setbacks during January-November 2023.

North America witnessed 43.2% decline in deals volume during January-November 2023 compared to the same period in the previous year. Similarly, the number of deals announcement in Europe, Asia-Pacific, Middle East and Africa and South and Central American regions too fell by 36.7%, 15.2%, 20.5%, and 42.3%, respectively, YoY during January-November 2023.

Meanwhile, key global markets such as the US, the UK, China, Japan, France, South Korea, Australia, Spain and the Netherlands witnessed YoY decline in deals volume by 44.1%, 29.5%, 4.5%, 46.9%, 20.7%, 26.7%, 30%, 56.8% and 35%, respectively.

Bose added, “All the deal types under the coverage also recorded YoY decline in volume during January-November 2023.”

For instance, the number of M&A deals declined by 34.6% while the volume of private equity deals and venture financing deals registered YoY decline of 31% and 26.3%, respectively