China is seeing record surge in searches, but for those searches to convert to bookings, it needs airlines, airports and hotels to quickly ramp up capacity.
Online travel agency Trip.com Group hopes that cross-border travel capacity for China will be back to normal by the third quarter of this year.
Since the announcement of the removal of border entry restrictions in China on December 26, Trip.com Group has noted a huge increase in search and volume of travel bookings.
On December 27, bookings for outbound flights from Singapore to mainland China jumped by 310 percent in just a day, according to Trip.com Group’s Chinese language platform, Ctrip.
From January 1 to January 10, cross-border air ticket searches surged 229 percent year-on-year, whilst the order volume increased by 289 percent year-on-year, according to Ctrip data.
Speaking this week at a session on “China’s Next Chapter” at the World Economic Forum at Davos, Trip.com Group CEO, Jane Sun, said domestic travel in China now exceeds 2019 levels, while international travel booking from countries outside China have witnessed three-digit growth.
“The most challenging piece is cross border transactions to and from China,” Sun said adding that the group has been coordinating with airline partners, hotels and airports to make sure they have a recovery plan in place while ramping up capacity.
Sun hoped that capacity would be around 30 percent in the first quarter 60 percent in the second quarter, and would normalize by the third quarter.
Airlines for America, a group representing major U.S. airlines, said this week that it does not foresee a return of significant international passenger air travel demand from either China or Japan before the end of March.
The limited supply has led to higher ticket prices where average airfares in December were 160 percent higher than in 2019, according to travel analytics firm ForwardKeys.
Even as flight capacity is at a fraction of pre-pandemic levels, international capacity to and from China scheduled for the month of February has risen by 23 percent over the first week of January and for March by 13 percent over the same period, according to aviation data provider Cirium.
China, the world’s largest outbound tourism market, was worth $255 billion in 2019.
“There is huge demand for cross-border bookings and we have seen three-digit growth in demand and search,” she said.
The challenge for Trip.com Group’s partners would be to quickly rebuild capacity as many airlines, airports, and hotels had laid off a large percentage of their staff during Covid.
The forthcoming week-long Lunar New Year will be the first major holiday in China following the relaxation of border policies.
Overseas travel for the seven-day Lunar New Year holiday surged by 540 percent compared to last year’s Spring Festival and the average cost of bookings has risen by 32 percent year-on-year, according to Ctrip data.
As of January 12, in the run-up to the Lunar New Year holiday, Trip.com Groups noted that overall travel bookings of mainland Chinese tourists to Southeast Asian countries increased by 1026 percent compared with the same period last year.
The number of air ticket bookings from mainland China to Southeast Asia increased by 864 percent year-on-year.
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Photo credit: Tourists at the Forbidden Temple in China. Sabel Blanco / Pexels