Shares of several international hotel companies dipped alarmingly at the beginning of the week, and not just because of the political delaying of the USD700 bn bail-out of the U.S. financial system. The global 2009 corporate travel outlook is growing gloomier by the day. As companies slash costs, airlines and hotels are preparing to tighten their belts.
While analysts are pessimistic about U.S. travel, what are the
ramifications for Asia – and particularly the mass hotel land grabs
ongoing in China and India? Marriott, for example, is seeking to grow
rapidly here. “Hopefully, we'll have over 100 hotels in China and India
in the next three or four years,” said Bill Marriott in September
2007.
This week, Marriott predicted that, “In 2009, at a minimum, the
company expects the business environment to remain unusually
challenging.”
It is not alone. Hotel executives are frantically bashing calculators
the world over to estimate the potential fall-out for travel markets
like China and India which, 12 months ago, were viewed as cast-iron
cash cows. They may still prove to be so, but the untrammeled
bullishness of 2007 is undergoing a short-term ‘correction.’
We write these words from the deluxe lounge of the Aman at Summer
Palace hotel in Beijing, which opened on 1 October. Luxuriously
landscaped across a 28,000 square metre site of grey-brick courtyards,
gardens and rockeries adjacent to the Summer Palace, the former retreat
of Chinese emperors, it is a stunning property. The 51-room hotel has
350 staff, and is characterised by Ming dynasty furnishings, burnished
copper bathtubs, heated Jin clay floor tiles and a 25-metre indoor
infinity-edged swimming pool that must be seen to be believed. Rates
begin at USD480 per night.
As the large hotel chains scramble to ascertain whether China will help
stabilise their global balance sheets, smaller, nimble boutique
operators – Aman now has 19 properties worldwide – are creating
exquisite properties across China; from ancient courtyards in Beijing
to 1920s townhouses in Shanghai and Tibetan farmhouses in Shangri-La.
The travel scene is, quite simply, being revolutionised.
As China’s complex inbound-outbound-domestic travel equation becomes
ever more fascinating, BizChina-Update will be launching a new monthly
feature, bringing you the latest news on travel and lifestyle issues
and events in China. We may not have the answers to the hotel
companies’ pressing questions – but we will cover, in depth, the
challenges, opportunities and conundrums in China as it moves
inexorably towards becoming the most-visited nation on earth.
Last update : Sunday, 05 October 2008
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