Destinations

The future of U.S. tourism: China, Brazil and Saudi Arabia lead the way

@denschaal

Jun 14, 2013 6:10 am

Skift Take

Airlines will make their own changes to meet this new demand from Asia, the Middle East, and Latin America.

— Dennis Schaal

Free Report: The Changing Business of Extended-Stay Hotels

Allen J. Schaben  / Los Angeles Times

Chinese tourists tote merchandise as they shop at the Desert Hills Premium Outlets in Cabazon, California, on March 29, 2013. Allen J. Schaben / Los Angeles Times


Chinese tourists will be arriving in the U.S. over the next few years by the millions, but U.S. tourism should also get ready for an influx of visitors from Saudi Arabia, the Russian Federation, Brazil, Argentina and Colombia.

The U.S. Department of Commerce’s Office of Travel & Tourism Industries’ 2013 Spring Travel Forecast shows that visitor volume to the U.S. will rise 4% to 69.6 million this year, and will climb at a compound annual growth rate of 4% in the 2013-2018 period.

That forecast, with the projected CAGR dipping from a previous 4.2% estimate to 4%, would mean visitor growth would rise 26% and deliver 84.6 million visitors in 2018, a jump of 17.6 million compared with the 2012 mark.

The forecast taps the leading origin countries in 2018 versus  2012 as China (up 229%), Saudi Arabia (191%), the Russian Federation (79%), Brazil (66%), Argentina (65%), and Colombia (54%).

One possible lesson here: There has been so much talk about hotels learning the customs of the Chinese to accommodate the influx of Chinese visitors. Perhaps hotels should also take a refresher course in the likes and dislikes of Saudis, Russians, Brazilians, Argentinians, and Colombians, as well, because they will be arriving, too.

Incidentally, the U.S. Department of Commerce should also learn how to spell Colombia, which it misspelled as Columbia in its announcement. After all, we know from social media and elsewhere that It’s Colombia, not Columbia.

Overall, all of the world’s regions will grow as visitation feeders into the U.S., with the Middle East (up 67%) leading the growth in 2018 versus 2012, followed by Asia (60%), South America (52%), Oceania (35%), Africa (30%), Europe (13%), Central America (8%) and the Caribbean (1%).

“We assume “supply‐side” factors, such as visa processing issues and air seat capacity will align with changes in demand,” the forecast says. “So for example, seat capacity will have to increase substantially from current levels to accommodate the increase in visitors expected from China.”

Canada and Mexico are projected to continue to be the top two origin markets for visitors — defined as staying at least one night — to the U.S. Their numbers are projected to increase 23% and 15%, respectively, in 2018 compared with 2012.

Forecast of international travelers to the United States by world regions

Origin Region Estimated change 2012-2018 Percentage increase Annual growth rate
Canada 5,199,000 23% 3.5%
Mexico 2,152,000 15% 2.3%
Western Europe 1,355,000 12% 1.8%
Eastern Europe 290,000 40% 5.8%
Asia 5,022,000 60% 8.2%
South America 2,309,000 52% 7.3%
Oceania 466,000 35% 5.2%
Caribbean 8,000 1% 0.1%
Middle East 622,000 67% 8.9%
Central America 67,000 8% 1.3%
Africa 112,000 30% 4.5%
Grand Total 17,603,000 26% 4%

The following provides more details from the Commerce Department’s travel forecast, which is updated every May and October:

“North America: The top two markets generating visitors to the United States – Canada and Mexico – are forecast to increase in 2013 by 5 percent and 2 percent, respectively, and to grow by 5.2 million and 2.2 million, or +23 and +15 percent, respectively, from 2012 to 2018. Growth from both countries would build on record-setting performances in 2012.

“Europe: Europe is projected to decline by less than 1 percent in 2013, followed by low but increasing growth over the next five years. The low-growth scenario for Europe is produced by dominant and low-growth Western Europe. Annual growth from smaller Eastern Europe is expected to range from 5.2 percent to 6.7 percent. By 2018 arrivals from Europe are projected to be 14.1 million, or 13 percent higher than the 2012 total. The largest growth in Europe will come from the U.K. (+555,000), Germany (+216,000), and France (+182,000). This growth will reflect low-growth rates based on large volume bases.

“Asia-Pacific: Asia is projected to generate a visitor increase of 8 percent in 2013. The region is projected to have consistently large increases over the next few years for a total 60 percent increase from 2012 to 2018. Japan, the largest Asian market and second-largest overseas market, is forecast to increase by 2 percent in 2013 and at a similar level through 2018 to produce total growth of 446,000 additional travelers by the end of 2018. However, 2018 volume will remain well below the 1997 record level of 5.4 million. High growth rates and high growth volumes are expected for China (30%), South Korea (8%), and India (7%) in 2013. Similarly, these three countries are expected to have among the largest total growth rates of any country from 2012 through 2018. China is expected to increase a total of 3.4 million visitors, or 229 percent through 2018, the second-largest number of additional visitors behind Canada. South Korea should produce an additional 540,000 visitors (+43%), while India could add 313,000 new visitors (+43%). Oceania is expected to post 7 percent growth in 2013, and add 466,000 visitors (+35 percent) through 2018. Australia dominates the Oceania region and is projected to increase 439,000 visitors, or 39 percent between 2012 and 2018.

“South America: South America is projected to increase by 11 percent in 2013, the largest growth rate of any region, and should remain a top producer of additional travelers for the next several years. By 2018 South America should generate 2.3 million more visitors, a 52 percent increase compared to 2012. Brazil, the largest source market in the region, is expected to build on its 2012 record-breaking performance, and increase 14 percent in 2013 and produce 2.0 million visitors. By 2018 the United States could host 3.0 million Brazilian visitors, a 66 percent increase over 2012. Venezuela, Argentina, and Columbia, in 2012 ranked 13, 14, and 16, respectively, are forecast to have high but declining growth rates through 2018. Argentina should produce the greatest growth of 397,000 visitors (+65%), followed closely by Colombia’s additional 325,000 visitors (+54%) and Venezuela’s potential growth of 195,000 visitors (+29%).”

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