While Asia’s Covid-19 recovery has been slower than the rest of the world, Accor is pinning hopes on the region driving the group’s development into 2024.
Jean-Jacques Morin, group deputy CEO, group CFO and premium, midscale and economy division CEO, said while Asia’s recovery from the pandemic lags behind other regions due to it being the last to reopen borders, he remains confident that full recovery will be met in 2024 – and growth will be exponential.
“I’m not sure Asia will have recovered as well as Europe or the US by the end of 2023 – there is a lag. But we will see the largest acceleration in Asia by early 2024,” he said, adding 50 per cent of Accor’s openings globally are within the region.
Morin said limitations on airlines – according to data from IATA, global airlines to Asia at the end of 2022 sat at 80 per cent capacity compared with 2019 levels – are one factor hampering recovery levels. “They’re still not at 100 per cent, but because of that, Asia has a nice path ahead,” he added.
In addition, the region is awaiting the “Chinese phenomenon”.
“Ninety percent of Chinese travellers stay in Asia,” Morin noted. “Once this Chinese phenomenon is unwrapped, it will flow throughout the continent. Asia has a very good story ahead.”
Another trend Morin has noticed in the region is that while occupancy rates hover below 2019 levels at an average of six per cent, pricing has risen.
“We’ve been able to push prices significantly,” he said. “People who have the money are really going overboard to get to where they want to go. The question these days isn’t, ‘do you have a room available?’ It’s, ‘give me your best room’.”
In addition, Asian travellers are now seeking experiential hotel stays, a trend Morin predicts will grow into the future.
“The way they look at a hotel is as an experience compared to other pleasures they used to have, which is to own something. I don’t need to own five cars but I want a vacation no one else can have,” he said.
“I believe the future for those with richness of (the) middle-class in Asia will continue to significantly grow, which is another very positive story.”