On July 16th, Finance Associated Press reported that although the tourism market has recovered rapidly in 2024, hotel and tourism businesses have unexpectedly encountered "double ice and fire".

According to Xingkuang data from Finance Associated Press, among the companies that have announced their performance in the first half of this year, only six companies such as Lingnan Group Holdings and Utour Group have made a profit, while the other ten companies have been bogged down in losses.

In the past, during the peak season of summer vacation, crowds of people flocked to various attractions, and airfare and hotel prices should have skyrocketed accordingly. According to Finance Associated Press, many businesses were hoping for another wave of profiteering during the summer vacation season this year.

However, an unusual scene emerged this year. The Sanya hotel industry led the way in drawing attention, with its prices "avalanching" and rushing up the hot search rankings, becoming the focus of public opinion.

Big data from Qunar shows that as of July 15th, the average actual payment for booked rooms in Sanya during the summer vacation had dropped by about 20% compared to the same period last year. Among them, the reduction in the price of five-star hotels reached 25%. However, it should be noted that the average actual payment for booked rooms in Sanya during this summer vacation is still slightly higher than in 2019, with an increase of about 6%.

Finance Associated Press reporters found that not only Sanya, hotels in many tourist cities nationwide have also joined the price-cutting ranks in order to attract more tourists.

"Sanya hotel market price reduction?"

"There are indeed many price reductions in Sanya hotels now. Previously, hotels in Sanya cost 588 yuan, but now they are less than 300 yuan," Mr. Teng from Hangzhou told Finance Associated Press reporters. He had helped the company train and book hotels in Sanya last year, and had just learned from the hotel's marketing office that he could apply for a buy-one-get-one-free promotion, which meant booking one room and getting another room for free.

Price reductions are undoubtedly a reluctant move by the hotel industry to attract customers.

Recently, the Hotel and Catering Industry Association of Hainan Province, the Hainan Cooking Association, and the Hainan Hotel and Catering Industry Federation jointly issued a call-to-action statement, calling on hotel catering enterprises and employees to work together to overcome difficulties and seek high-quality development.

The statement mentioned that since this year, the operating conditions of hotel enterprises in Hainan Province have sharply declined, and many enterprises are facing the dilemma of greatly reduced customer traffic and universal losses. Therefore, some hotels and catering enterprises have had to take measures such as reducing staff, reducing salaries, adjusting salary structures, and implementing unpaid leave to maintain their operations.

However, shortly thereafter, the Hotel and Catering Industry Association of Hainan Province, the Hainan Cooking Association, and the Hainan Hotel and Catering Industry Federation issued another joint statement, "Joint Declaration: Hainan Hotel and Catering Industry Prospects are Good, Collaborating for Transformation, Upgrading and High-Quality Development," on their official WeChat account.

The statement stated that the recently released call-to-action statement aims to enhance mutual understanding and increase confidence in the hotel and catering enterprises and employees. However, due to inappropriate expressions, some self-media have misunderstood the original intention of the statement and even used it as an excuse to defame the Hainan hotel and catering industry. The joint statement expressed disagreement with this and deeply apologized for any misunderstandings caused by inaccurate language.

The joint statement further emphasized that the call-to-action statement is not to disparage the Hainan hotel and catering industry, nor is it a pessimistic prediction of its prospects.

According to research by the Qunar Big Data Research Institute, it is more appropriate to say that Sanya hotel prices have returned to normal rather than calling it a "collapse".

The researcher from the Qunar Big Data Research Institute said that last year the international and domestic tourism markets had just opened up, with few options for tourist destinations, and Sanya, as a very mature resort destination, attracted a wave of tourists, and hotel prices soared. This year, the tourism market has opened up comprehensively, especially for a batch of Southeast Asian countries that have waived visa requirements, including countries such as Thailand and Malaysia, which offer the same type of destination and have similarly superior resort resources as Sanya.

"Yes"

According to the aforementioned researchers, summer is not the peak season for Sanya, and hotel prices will also be adjusted compared to winter. From the current hotel prices in Sanya, it has returned to the normal level of the summer of 2019. "Faced with an increasingly competitive market, hotels need to compete for scarce resources and the ability to link local entertainment. The prices of Sanya Atlantis, Yalong Bay MGM, Hilton and other hotels, which focus on parent-child and high-quality vacation trips, remain strong in the summer of this year."

"In the past two years, tourism in Sanya is not as popular as before," said Mr. Xu, a local yacht operator in Sanya, to a Caixin reporter. In recent years, fewer people have come to Sanya and their willingness to consume has significantly decreased. In the past summer vacation, a medium-sized yacht trip cost 1988 yuan, but now even a price reduction to 688 yuan may not be enough to attract enough tourists.

According to Mr. Xu, the significant drop in yacht prices reflects the structural changes in the tourism market and the weakening of consumption willingness. This phenomenon has not only affected the yacht industry but also directly impacted Sanya's hotel industry.

Caixin reporters noticed that many hotels across the country have joined the price reduction list, not just in Sanya.

According to data from the Qunar platform, the average price of mid-range hotels has dropped by about 8% compared to the summer of last year, breaking the usual high price during peak season. Many hotels choose to stabilize or even lower their prices to improve their occupancy rates, especially for non-resort and characteristic hotels.

The tourism industry is undergoing structural changes.

"The concentration of tourist destinations is decreasing, and the trend of market diversification is significant," said Jiang Han, a senior researcher at Jingping Think Tank and Pangu Think Tank, to Caixin reporters. In the past, tourism was often concentrated in popular tourist destinations such as Beijing, Shanghai, and Xi'an. However, in recent years, with the change in consumer tourism concepts, more and more people have begun to pursue personalized, niche travel experiences.

Jiang Han further analyzed that this change not only reflects the choice of tourist destinations but also reflects the changes in tourism methods and service needs. Tourists no longer pursue traditional popular attractions but are more willing to explore relatively unknown places, such as small towns with unique natural scenery or cultural characteristics, or even outdoor activities such as rural and hiking tours.

The change in tourism consumption habits has made many scenic spots and travel agencies' previous operating models outdated. The prevalence of independent travel has catalyzed the impact of this change, which has also been reflected in the performance of some listed tourism companies.

According to Caixin Star Mining data, among the six profitable companies, Lingnan Holdings, Utour Group, Changbai Mountain, Wuhan Sante Cableway Group, Dalian Sunasia Tourism Holding and Shanghai Jinjiang International Hotels have achieved profitability.

Lingnan Holdings is expected to make a profit of 34.5 million yuan to 43.5 million yuan; Utour Group's loss of 36.7778 million yuan in the same period last year is expected to turn into a profit of 60 million yuan to 75 million yuan this year; Changbai Mountain is expected to make a profit of 26 million yuan to 29 million yuan in the first half of this year; Wuhan Sante Cableway Group is expected to make a profit of 56 million yuan to 84 million yuan this year; Dalian Sunasia Tourism Holding is expected to have net income of 7.4683 million yuan to 11.2025 million yuan this year; Shanghai Jinjiang International Hotels is expected to have net income of 0.8 billion yuan to 0.85 billion yuan this year.

The remaining 10 companies have suffered different degrees of losses, which is in stark contrast to the still hot cultural and tourism market.

Among the losing companies, there are some scenic spot enterprises that were once very prosperous.

For example, three scenic spot enterprises, Tibet Tourism, Guilin Tourism Corporation, and Xi'an Qujiang Cultural Tourism, all went from a profit to a loss. Among them, Tibet Tourism had a loss of 9.5 million yuan; Guilin Tourism Corporation had a loss of 14.76 million yuan in the first half of this year, down from a profit of 0.1439 million yuan in the same period last year; Xi'an Qujiang Cultural Tourism had a loss of 1.52 billion yuan to 1.82 billion yuan this year, down from a profit of 2.8581 million yuan in the same period last year. The losses of Xi'an Tourism and Zhangjiajie have also shown a trend of expanding.

It can be seen that although there are multiple small vacations in the first half of the year, it still did not boost the performance of tourism companies that rely on ticket revenue. However, the situation during the summer cannot be blindly optimistic.

Caixin reporters obtained big data from Qunar, which shows that this year's summer tourism market is different from previous years, presenting a situation of "quantity increase, price decrease". Many tourism companies are passively relying on weather conditions, rather than taking the initiative.

As of now, the average payment price for domestic air tickets during the summer has decreased by 6% compared to the same period last year. The average price of the Zhongxing Hotel, which had sky-high prices last summer, has dropped by 8%. The price of outbound travel flights and hotels has declined even more. The average payment price for international flights during the summer has dropped by 22% compared to the same period last year, and the average price per night for international hotels has dropped by 24%. In terms of comprehensive costs, the cost of outbound travel to some Southeast Asian countries is even lower than that of some domestic destinations.

For example, in most cases, Bangkok, Thailand, which was among the top three popular tourist destinations for outbound travel, was priced at around 1,800 yuan for round-trip tickets from Beijing during the summer, and some high-end hotels were cheaper at more than 100 yuan per night. The local consumption level is also cheaper, and the overall cost is not more expensive than some cities in China.

According to big data research by Qunar's research institute, there has been a significant increase in capacity on international flights and the global hotel supply chain has basically returned to the 2019 level compared to last year, resulting in a significant year-on-year decrease in international airfare and hotel prices. On the other hand, as the level of domestic economic development improves, traveling abroad is sometimes cheaper than traveling domestically. For ordinary people, the threshold for outbound travel will also become lower and the outbound travel market will sink further.

Obviously, due to the interconnection of the global tourism market and the gradual expansion of China's visa-free circle of friends, domestic tourism companies will have competitors beyond domestic ones.

It is imperative for business such as scenic spots and travel agencies to optimize and upgrade, get rid of simple ticket economy, and create more products that cater to user experience and have high cost performance to cope with the increasingly fierce competition.

"This trend makes the ticket, airfare, and hotel prices of popular domestic tourist cities no longer as high as they used to be, providing more cost-effective travel options for more consumers," said Jiang Han to the Caijing.