China shows “the shape of recovery” from the coronavirus in travel with two-thirds of hotels re-opening, according to hospitality data analyst STR.
Robin Rossmann, STR managing director, reported “encouraging” occupancy after many hotels in China had been closed for months. But he forecast it would be 2022 before the industry recovers in Europe.
Rossman told a Hospitality Tomorrow videoconference: “Coronavirus has had a devastating impact on our industry. China is the best scenario we have to show the shape of recovery.”
He reported occupancy “up 10 percentage points in the last two weeks” and argued: “Occupancy of 30% is encouraging.”
Highlighting data for the industrial city of Chengdu, Rossmann said: “Chengdu has seen a strong recovery. It has tended to be in the mid-scale and economy markets.
“The first phase of recovery has been driven by domestic leisure travel, corporate travel in technology and industrial zones, and quarantined guests in hotels close to airports.
“Lower scale hotels have done better than higher. The luxury and top-end has struggled a bit more.”
Looking beyond China, he said: “A short-term decline and bounce back seems unlikely. Covid has been extreme.
“Economists forecast a V-shaped recovery. [But] in our industry it is not likely to be as quick given countries are likely to restrict their borders to prevent the virus coming back.”
He forecast average occupancy in Europe this year would be 40% down overall and the US 50% down and said: “We expect only to get back to 2019 levels in Europe by 2022.”
Rossmann added: “We are likely to see some behavioural change. Corporate events are likely to take longer [to come back] and attendance [at events] may remain suppressed.”
Olivier Jager, chief executive of airline-bookings analyst ForwardKeys, agreed Chinese leisure travel was recovering more slowly.
He told the Hospitality Tomorrow conference: “China got to the bottom in the week of February 12. The rebound is flat for the last four weeks.
“A V-curve [recovery] is not happening in China. The rebound is stalling at around one third of what business is usually.”
Jager said ForwardKeys had compared data for leisure destination Hainan with business centre Shenzen and concluded: “The revival for Shenzhen is more than for Hainan.
“Hainan is open for business, but the key feeders of Hainan are not – Beijing and Shanghai. The rebound is going to be slow.”
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