We head into 2020 with more question marks than any year of this cycle. Risks are rising and the global economy is slowing. Here's what you need to know to be prepared.
Potential warnings signs are beginning to show for the travel economy as we push ahead into 2020. It’s unlikely, however, to turn into a full-blown, global downturn.
But here is what’s top of mind for Skift Research heading into the new year: Be prepared, but don’t panic.
Just remember, while the global economy may be slowing, it’s still growing. The fundamentals of the global economy, political risks aside, are buoyant and pushing us in the right direction, and it’s more likely than not that we will continue to grow in 2020 as well.
We forecast another good year for international tourism flows in 2020. After what we estimate to be 1.3 billion international tourism departures in 2019, we expect about 40 million new trips in 2020, growing the total by 3 percent to 1.34 billion.
Most of these new trips will come from the Asia-Pacific region. We expect that international departures growth will only continue to accelerate, on a path toward our 2024 forecast of 1.54 billion trips.
Across the board in hospitality, online travel, and airlines, we anticipate further expansion throughout 2020, though key metrics are slowing, both as a result of a step down in economic growth and due to changing consumer tastes. Industry leaders are rising to meet these challenges by evolving their product offerings. Be it hospitality leaders shifting toward alternative accommodations or online travel agencies hoping to deepen direct customer relationships.
Downside risks are still ever present, perhaps most importantly, escalating trade wars across many regions. This could lead to a decoupling of growth where some regions slow more dramatically as others accelerate. A breakdown in international ties could also drive domestic tourism over international exploration.
Our base case is for a rebound, but management teams would still be wise to heed these risks. For every 10 risks you prepare for, perhaps only one will materialize, but that does not make a cautious planning exercise for the other nine a waste of time.
What You’ll Learn from This Report:
- Global economic growth forecasts
- International arrivals growth forecast and tourism’s contribution to economic growth expectations
- U.S. consumer and corporate economic expectations
- European economic growth expectations for key regions and countries
- Sales, earnings, and key metrics growth estimates for the hotel, airline, and online travel industries
This is the latest in a series of monthly reports aimed at analyzing the fault lines of disruption in travel. These reports are intended for the busy travel industry decision-maker. Tap into the opinions and insights of our seasoned network of staffers and contributors. Over 200 hours of desk research, data collection, and/or analysis goes into each report.
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