Chinese agents feel the crunch

THE US and Eurozone financial crisis is keeping inbound tour operators in China at the edge of their seats, with some saying that business from these segments has yet to recover.

Guo Lingmei, spokesperson of Beijing-based BTG International Travel and Tours, which handles inbound leisure tours, said that sales had been steadily declining by 30 per cent every year since the 2008 financial crisis.

Guo said the agency was only able to hit 40 per cent of its target for these markets. She added that the agency has been feeling the pinch even in Germany, traditionally its best source market.

As a result, more attention has been given to developing outbound tours, especially at a time when a strengthening Renminbi is fuelling Chinese consumers’ travel purchases.

Like Guo, CYTS North American department senior manager, Michael Tan, who oversees inbound from the US and Canadian markets, said his core business had been “very obviously affected” since 2008.

“There was a very significant decline in 2009. It was stable last year, but it has gone down again this year,” he said.

“We handled an average of 8,000 to 10,000 North American visitors per year before the crisis. So far, the number has dropped to around 6,000.”

To make up for the loss of income, Tan’s department had resorted to targeting other English-speaking source markets such as the UK, Chile and Malaysia, as well as widening its business scope.

Tan said: “We’ve never handled meetings or outbound to the US before 2009. Now, we handle both inbound and outbound, corporate travel into China, as well as MICE, which we used to refer to specialist operators.

“Even though we end up cannibalising business from our sister outbound office, we have no choice. We can’t only rely on North American inbound, as the people there have no confidence in travelling due to the economic crisis,” he said, adding that the unfavourable currency exchange rate was a strong deterrent.

– Read more in TTG Asia, November 4 issue

Additional reporting by Amee Enriquez

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