“We think that 2019 will be a really challenging year for the U.S. travel industry, when it comes to attracting Chinese inbound tourists.” This was the first sentence out of the mouth of Yiling Pan, editor of Jing Travel, the Chinese publication and website that specializes in coverage of the Chinese luxury travel market, as she greeted delegates to Connect Travel’s RTO Summit East last week in New York.
And as she continued, the message got no better as Pan, in terms and tone that were both polite but blunt, explained that what data there are available tell us that it is not going to be a good year; Chinese travelers have concerns over their personal safety when they travel to the United States; and there has been a negative reaction to policies of U.S. President Donald Trump that are perceived as “against minority groups like Latino and Asian populations” and have created an atmosphere in which the latter “don’t feel safe to be here.”
Following are some of the data Pan used to buttress her projection for a weak year for the Chinese market, followed by three factors that are contributing to what amounts to a contraction in the market.
The Numbers: Since it is still relatively early in the year, Pan pointed out, there are no meaningful or real-time data for 2019 available that would support or weaken the case for her outlook for the Chinese market. But there are numbers from 2018, and they do not auger well for 2019.
—According to the U.S. State Department, from May through September in 2018 there were 100,000 fewer Chinese people receiving business, leisure and educational visas compared to the same period in the previous year—a 13 percent drop from the previous year.
—A Skyscanner report revealed that Chinese airline reservations to U.S. destinations have shown a significant decrease. It dropped 42 percent in the first week of October 2018—which was a seven-day national holiday for Chinese people. That normally means an increase outbound travel, but last year it was a significant drop
— According figures made available by the World Travel and Tourism Council, spending by international visitors to the United States dropped nearly one percent last year vs. 2017; this was largely due to a lack of growth in visitors from China, whose numbers account for 11 percent of all spending worldwide.
—Though no official figures on the subject have been released, it seems that there was an increase in visa rejection rates
Key developments that helped create the outlook described above include the following.
Trade War and International Relations between U.S. and China. Said Pan: “This has an impact on the sentiments of the Chinese. Regarding the U.S. Not a huge impact, it’s not wide spread, but there are pedagogic voices in discussion on the social media talking about whether they should come to the states; how do they feel about this ongoing trade war; and how do they feel about Trump’s policies, and things like that—which affect people’s positions about whether they want to come or not.” Added Pan: “We do feel that the feelings of Chinese people about the U.S. have changed a lot (and affected) the appeal of this country (the U.S.) as a destination.”
Perception of Safety. “A lot of people outside of China don’t think safety will be a huge factor that will cause people to travel or not,” Pan explained. “But, for Chinese travelers, you have to understand: security and safety abroad is a real concern for them, and it’s one taken seriously when planning a trip.” It doesn’t whether people are wealthy or not, observed Pan, who told Summit delegates, “you have to understand that Chinese people prioritize safety in the travel decision-making process.“
—Pan cited a hotels.com survey from last year indicating that 61 percent of Chinese travelers indicating that safety was the top priority that they have to consider when determining if they want to visit a place or not.
—A study by HURUN, a research firm that focuses on High Net Worth Chinese indicated that its survey of high net worth Chinese showed that traffic safety, natural disasters, and robbery and theft are major travel concerns they have when considering whether to visit a place or not.
—Some delegates winced a little when Pan explained that, “When one thinks about the United States, we hear about gun violence, terrorist attacks and things like hate crimes—these things have been frequently and constantly reported by Chinese media, or speculated about on the social media. So, ordinary kinds of people gain access to information like that and this will actually affect their perception of this country. They will feel, ‘maybe it’s not a good idea to visit the U.S. at this time of the year. We don’t want to have gun violence or terrorist attacks happening.’ ”
—Trump’s Immigration policy is having a negative impact on how Chinese people feel about his country. Pan pointed out that, “based on our reporting and also talking to people in China, some people … mention that, after see Trump’s policies against minority groups like Latino and Asian populations, they feel like it’s not safe to travel here. They don’t want a hate crime to happen, and they are afraid of any violence against Asians, because we are a minority and they’re abroad and many of them don’t speak English, so they don’t feel safe to be here.”
Chinese Government’s Push for Domestic Travel (vs. International Travel)
According Pan, in recent years, China’s government has put a lot of effort into making Chinese people rediscovering the beauty of their own country. Some efforts include new infrastructure, like high-speed bullet trains. Most provinces and popular destinations will have such trains to use for travel.
At the same time, many Chinese DMOs are putting a lot of effort into marketing and promotion, in order to educate Chinese people as to why they should visit their destinations. They are telling Chinese people, “You have to come here and experience that; it’s very different from what you’ve seen before.” Said Pan: “We think these efforts have been kind of successful in getting more Chinese people to focus on traveling within the country instead of going abroad.”