China beyond the gateways

China beyond the gateways

Tourism to China has traditionally been based around Beijing and Shanghai, but that could be in for a shake-up thanks to a boom in flights to regional cities.

In the past, tourists have often added a Yangtse river cruise and perhaps a tour to Xi’an for its Terracotta Army, Chengdu to see giant pandas and Guilin for its limestone karst scenery and cormorant fishermen. But access from most international markets has been through its two key gateways.

In the last couple of years, however, direct services linking China’s second and third-tier cities to overseas destinations have mushroomed, mostly driven by Chinese airlines.

Following an agreement last December, boosting the number of flights permitted between the UK and China by 50%, London’s Heathrow alone has seen the Chinese points it serves more than double in 2018 from five to 11. New destinations Chongqing, Wuhan, Sanya, Changsha, Xi’an and Shenzhen are served by a combination of seven Chinese and two British carriers.

London Gatwick gained Chengdu flights by Air China in July, about 18 months after British Airways dropped its Heathrow-Chengdu route dubbing it not commercially viable.

Among other European gateways, Amsterdam has flights to secondary cities including Xiamen and Fuzhou, while Paris has services to Xi’an  and, from December, Shenzhen  and Chongqing.

In the States, Los Angeles now has direct flights to 12 Chinese points, including Xiamen, Hangzhou, Nanjing, Jinan, Chongqing, Changsha and Chengdu, with Xi’an and Shenyang set to join them. Non-stop flights between the USA and China (excluding Hong Kong) have risen from 10 in 2006 to 61 in 2018.

Does this mean tourism to China will diversify? Opinion is mixed. Some observers claim the sudden proliferation of routes has been largely driven by the Civil Aviation Authority of China’s “one route, one airline” policy, adopted in 2009.

This is now being eased to promote growth of the new Beijing Daxing International airport, opening in 2019, with the result, some say, that existing routes might be consolidated.

Meanwhile, overseas passengers can be reluctant to fly on Chinese airlines, while Chinese passengers favour their own carriers.

Tour operator Links Travel & Tours says its clients prefer to change in Beijing and Shanghai than fly direct with unfamiliar airlines.

“During 2018, we’ve been in partnership with Hainan Airlines offering its direct flights from Manchester to Beijing, but have received very little interest, as UK travellers are wary of using airlines they haven’t heard of,” says UK marketing manager Hannah Lockett.

“The UK travel market, for our demographic, is a very conservative one that doesn’t like change.”

The expansion of bullet train services between Chinese cities also means that it’s not important where people fly to or from, she contends.

Another tour operator, who asked not to be named, claimed some Chinese airlines are only interested in the outbound market and are not geared up to work with overseas tour operators. It cited an example of a carrier that was not on GDS system Amadeus and refused to issue previously-booked tickets a week prior to the travel date unless paid in cash at its China HQ.

Growth potential

UK-based CTS Horizons is part of one of China’s largest travel groups, the CTS Group, which has 20 branch offices around the world.

Managing director Rose Zhang believes the main secondary destination that will benefit from direct flights is Sanya, a resort on southerly Hainan Island – nicknamed “China’s Hawaii” for its tropical climate.

Since May, visitors from 59 countries have been able to stay for up to 30 days in Hainan province visa-free, if arriving on direct flights. Zhang says they can journey onward in China with a visa that takes just 48 hours to process there, provided they apply prior to travelling to Hainan.

She highlights Xi’an as another destination that will appeal to foreign visitors, plus Qingdao for its German heritage and beer brewing.

There’s also talk of growth potential from Wendy Wu Tours – the largest operator to China out of the UK, Australia and New Zealand. Founder and owner Wendy Wu says it is working closely with airlines to develop tours based around flights to second and third-tier cities.

“We’re building packages and we view it as our duty to develop these routes as part of our strategy, but the challenge is pretty big,” she says.

“The reason the first-tier cities continue to grow is because they’re famous, whereas other cities such as Qingdao and Changsha are not as well-known simply because they have not had the exposure, not because they are less attractive. These cities have good tourism infrastructure, but they don’t have the money to promote their destinations.

“The fact that there are direct flights will allow these naturally beautiful destinations to flourish.”

However, Wu is concerned about the barrier posed by new rules, which came into force in November, requiring applicants to visit the Chinese embassy in their country to have their fingerprints and biometric information recorded, plus a more complex form from December. For her own company, she believes it will stifle growth and lead to a flat 2019.

She is calling on the government to allow visa-free travel for three or seven days. “It would be like a snowball and grow tourism to China,” she says.

In 2017, the number of foreign visitors to China grew 3.6% to 29 million, Ministry of Culture and Tourism figures show. The top four source markets of Myanmar, Vietnam, South Korea and Japan accounted for more than half of this.

Euromonitor International research manager Shirley Lu and travel research consultant Wouter Geerts say outbound travel is increasingly commonplace among the Chinese middle classes, stimulating demand for connections from second and third-tier cities.

The company forecasts outbound trips by Chinese residents will total 260 million by 2030, making China by far the world’s largest  source market.

“With 127 million arrivals by 2030, China will also become the largest destination,” the consultants say.

Following extended visa-free travel for visitors to Hainan, they predict further such initiatives, while improved tourism infrastructure and diversified product will also help.

Six airports in China were among the top 20 fastest-growing in the world during the first half of 2018, led by Quanzhou Jinjiang International airport.

Meanwhile, the China Outbound Research Institute has forecast Chinese people travelling internationally will almost triple over the next decade to surpass 400 million by 2030.

A recent report on the market by Resonance Consultancy adds that in just over a decade the Chinese will account for a quarter of all international travel.

With growth already coming from the tier-one cities, the extra numbers will come from elsewhere, Resonance’s president and chief executive Chris Fair explains.

“We have hundreds of other cities that travellers are coming out of and there aren’t direct connections yet with those. It’s quite staggering to look at the list.

“We’re going to see something in the order of three to four times the current numbers as that market grows, and it will lead to more flights.”

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