FOXTROTS*

 

Travel Industry Data Updates, April 1-5

From http://www.travelbusinessanalyst.com

 

Travel business updates

5 April 2019

[] Hyatt forecasts it will grow from 19 cities in India to 27 by end-2020 – with 14/2100 more hotels/rooms.

[] IATA (International Air Transport Association) reports February RPKs +5.3%, ASKs +5.4%, load factor 80.6% -0.1pt.

-RPKs by region – Asia Pacific +6.3%, Europe +7.3%, Middle East -0.9%, North America +4.2%.

-International RPKs +4.6%, ASKs +5.1%, load factor 79.5% -0.4pt. Asia Pacific RPKs +4.2%, Europe +7.6%, Middle East -0.8%, North America +4.2%.

-Domestic RPKs +6.4%, ASKs +5.8%, load factor 82.4% +0.5pt. RPKs in Australia -1.7%, Brazil +5.8%, China +11.4%, India +10.0%, Japan +2.5%, Russia +10.1%, US +4.5%.

[] STR (nee Smith Travel Research) reports on US hotels:

-24-30 March occupancy +4.2% to 69.5%, average room rate +0.9% to US$131.77.

-17-23 March occupancy +0.2% to 69.6%, average room rate +0.2% to US$133.65.

 

Flat UK hotel sales

4 April 2019

PWC* (international accountants nee Price Waterhouse Coopers) forecasts a flat year for UK hotel deals – although it reports growth, and its figures show a fall! For 2018, it reports US$8.57bn (at US$1 to £0.77) +36%, and it forecasts (apparently for this year) +10% to US$7.79bn.

  Clearly, because figures can vary so much in one year – sometimes due to special cases – the industry should follow what some in the MICE industry, and we, do. That is to calculate growth in 5-year averages – to balance out distortions caused by unusually-big or -small deals in one year.

PWC also reports some operational data:

-Forecasts London occupancy growth +0.3%, ARR (average room rate) +1.4% for the next two years, taking it to US$196 +1.3% this year and US$199 +1.3% in 2020.

-Supply (we believe this data is just London) grew +2% in 2018, and PCW forecasts +4% in London this year.

-Regions (ie, everywhere outside London) occupancy this year -0.1%, ARR +0.5%, taking it to US$95.

-In 2020 it forecasts regions occupancy -0.1%, ARR +0.8%, although it gives the same figure as this year, US$95.

*Notes: At press time, PWC had not answered our request for clarifications.

 

Outbound – China, US

3 April 2019

[] Global Data forecasts outbound spend of ‘Chinese travellers‘* will be US$375bn in 2022, from US$244bn in 2018 (and US$295bn in 2020) an +11.3% AAGR (annual average growth rate) and +12.6% 2020-22. For this year it forecasts +9.7% to US$268bn.

*Notes: We presume GD is forecasting for all residents in China not just China nationals or ethnic Chinese.

[] The US has re-released US outbound travel data for 2018. The main figures are unchanged:

-Total nationals (thus excluding non-citizen residents) 93.0mn +6.1%.

-North America (Canada, Mexico) 51.3mn +3.8%.

-Overseas 41.8mn +9.0%. Shares: Europe 19% +1pt; change not given for rest – Asia 7%, Middle East 3%.

 

Hotel growth – Asia Pacific, Europe

2 April 2019

Research & Markets* (RM), a company, reports:

On hotels in Asia Pacific:

-2017 hotels 63,616, a +4.8% AAGR (annual average growth rate) over 2013-17.

-Forecasts 81,234 in 2022, a 5.0% AAGR (which calculates to the period 2017-22).

-RM gives fastest category growth without actual totals, reducing the value of that information. It reports a +6.8% AAGR, fastest, for luxury hotels over 2013-17, and +4.2% for midscale, slowest.

On hotels in Europe:

-2017 hotels 188,898, a +0.7% AAGR over 2013-17.

-Forecasts 204,925 in 2022, a 1.6% AAGR (again which calculates to the period 2017-22).

-Category growth, also without totals – a +3.3% AAGR, the fastest, for luxury hotels over 2013-17, and +0.2% for budget, slowest.

*Notes: We have run many critical reviews on RM reports, and we advise users to treat its findings with caution – most apparently due to imprecision in its editorial commentary. At press time, RM had not answered our request for clarifications.

 

TBA Tracking; March travel stocks; another bad month

1 April 2019

Travel stock prices (US, Asia Pacific, Europe) in March. Airlines: biggest growth, Jet Airways +21%; biggest fall, Norwegian -24%. Hotels: NH, Spain +7%, Wyndham -10%. Tech: cTrip +28%, Trivago -14%. Others: Eurotunnel +4%, Thomas Cook -18%.

Previous month: Airlines: biggest growth, China Southern +15%; biggest fall, Norwegian -53% (sic). Hotels: Shangri-La +10%, MGM -10%. Tech: eDreams +9%, Booking -11%. Others: Avis +35%, TUI -32%.

TBA Travel Stocks Index: World 222, Asia Pacific 100, Europe 194, US 371. Index previous month: World 224, Asia Pacific 98, Europe 194, US 380.

NVTT (Net Value Travel Tech) Stocks Index: 128; previous month 124.

Stockmarkets. Biggest growth India +8%; biggest fall Istanbul -10%. Previous month: biggest growth Shanghai +12%; biggest fall India -2%.

Comments:

-Airlines are still performing badly. Of the 14 in AsPac, 8 are falling; in Europe 10 9 (the other was unchanged); US 7 6. And, unusually, hotels were almost as bad as airlines: AsPac 6 4 (plus one unchanged); Europe 5 3; US 9 7.

-India’s Jet Airways was top-growth airline following speculation of an ownership change, although it may also be shut down. Remarkably, it is the third of Etihad-owned airlines to fall into financial trouble. Its Air Berlin has shut down, and Alitalia is in bankruptcy. Despite that growth, Jet’s current price is -3% down on its end-2018 price.

-Strangely, the airline at the bottom of the table, Norwegian, was also surrounded by takeover and shutdown speculation.

-Another airline with strong growth was Air China +14%.

-Also falling big were ICAG (International Consolidated Airlines Group; AerLingus British Iberia Vueling, plus) -15%, and SAS -20%. We still think SAS’s survival is in question – although we have been expecting that for a decade.

-We have noticed sizeable monthly fluctuations in travel-tech shares (although our NVTT Index was up slightly). Does this mean that the investment community still cannot easily determine what may be good or bad news?

-Boeing’s price was -13%, fallout from the grounding of its B737max aircraft.

Info from Travel Business Analyst. Details in next month’s editions of WYSK: What-You-Should-Know, published by Travel Business Analyst.

 

 

 

The Fox. Remember, I’m an industry expert in the parallel world.

*Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning.  Foxtrots – leading the industry in a dance.