(Jan 24): Minor International Pcl, one of Asia’s largest hospitality groups, aims to add 250 properties to its global hotel portfolio over the next three years, as the revival of outbound Chinese travellers underpins the strong recovery of the global tourism sector.
The expansion, most of which will kick in after this year, comes as Bill Heinecke, the chairman of the Bangkok-based company, said he expects “extraordinary” 2023 results and an even better performance this year. The Thai government’s tourism-promotion measures such as visa waivers and an extension of operating hours for entertainment venues have been crucial to growth in Minor’s home market.
Bookings in Thailand jumped by about 30% in the first two months of 2024 from the same period last year, with Chinese reservations about doubling. Minor currently has 530 hotel properties in nearly 60 countries, with most of its business in Europe through NH Hotel Group SA, which it acquired in 2018.
“One thing that’s happened post-Covid is that we’ve seen, because of much higher costs of travel, a much higher quality of tourists coming not only to Thailand but all over the world,” the American-born Thai founder of Minor told reporters in a group interview in Bangkok.
Heinecke’s optimism contrasts with a new Bloomberg Intelligence survey released on Tuesday, with analysts Angela Hanlee and Rebecca Wang saying that results indicate that budgets for Chinese travellers, for both domestic and international travel, “might decrease or stay flat in 2024 as macroeconomic headwinds drive cautious spending sentiment.”
Chinese visitors will reclaim the top spot of foreign arrivals to Thailand this year, Heinecke said. Increased flight capacity and a permanent bilateral visa waiver programme, expected to start in March, will accelerate the comeback of Chinese travellers, he said.
Thailand’s tourism minister, Sudawan Wangsuphakijkosol, said last week that 35 million foreign tourists are expected this year, edging toward a pre-pandemic record of 40 million, supported by campaigns to lengthen holidaymakers’ stays and year-round festivals.
Foreign tourist receipts are expected at 1.9 trillion baht (RM250.6 billion) in 2024, nearly two-thirds the overall revenue goal of three trillion baht, which also includes spending by locals, she said.
The government forecasts about eight million tourists from China, which before the pandemic was the largest overseas source of travelers. By comparison, the biggest market in 2023 came from Malaysia, with a tally of 4.6 million.
“Chinese travellers will be back in strength,” Heinecke said. “We’ll feel the full impact of bringing the aircrafts back into circulation in 2024.”
Chinese tourist arrivals to Thailand may total about seven million this year, with rising economic pressures in China and safety concerns among factors that will likely temper travel, Bloomberg Intelligence aviation analysts Tim Bacchus and Eric Zhu said in a report.
In the last quarter of 2023, Minor reported an occupancy rate of almost 70% in its Thailand business and year-on-year revenue growth of 15% per available room. The company also has more than 2,600 casual dining and quick-service restaurants around the world.
Minor shares advanced as much as 4.5% on Wednesday, trimming losses this year to 3.4%.
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