Relax - Travel agencies report pick-up in CNY bookings

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SINGAPORE - Even as tour bookings pick up for the upcoming Chinese New Year (CNY) holidays, the travel industry is bracing itself for an uncertain outlook next year.

Five Stars Tours is expecting a 5-10 per cent increase in business for the CNY festive season while CTC Travel and ASA Holidays say that they have already seen a 15 per cent rise in the volume of bookings for the period. Other travel agencies such as Nam Ho Travel Service and Chan Brothers report a similar volume of CNY sales compared to a year ago.

'We are expecting to sell out by the first week of January,' says Alicia Seah, senior vice-president of marketing at CTC. This year, the CNY holidays fall on Jan 23 and 24, a Monday and Tuesday, making a week-long holiday possible without having to take too much time off work.

Referring to small businesses such as hawkers, bakeries and retailers, Eileen Oh, head of marketing and communications at ASA Holidays, said: 'This is the only time of the year where they can afford to take a break from their businesses which otherwise operate seven days a week.'

Popular destinations include Taiwan, South Korea and China, particularly with airlines adding new routes to various Chinese cities.

The year 2011 has been fairly resilient for Singapore's travel industry, according to industry players.

CTC's Ms Seah says that while the company has seen the leisure travel segment fall by about 8 per cent because of the Singapore general elections as well as the twin disasters which hit Japan, the meetings, incentives, conferences and exhibitions (MICE) segment grew 15 per cent.

Meanwhile, Chan Brothers is expecting its 2011 sales to reach $200 million, up 20 per cent from last year.

Robert Bailey, CEO and president of Abacus International, says: 'For Asia-Pacific, due to the challenges we have faced this year, the initial forecast of 4-8 per cent (growth) has been revised to 2-4 per cent.'

Abacus creates travel software tailored for the Asia-Pacific market.

But at least that's still positive growth, he points out, 'which is further testament to the resiliency of the travel industry in Asia'.

The outlook for 2012, however, is a lot less clear given that the global economy is in a state of flux, and an economic slowdown is expected here as well, he notes.

In any case, technology may prove to be a key driver in the travel industry, says Mr Bailey. 'In this value-driven economy, with the enormous growth of low-cost carriers (LCC) and lowering of prices, the travel industry is becoming increasingly competitive. Travel businesses have become more savvy in adopting new technologies in order to retain a competitive edge, especially now in the areas of mobile and electronic transactions.'

With three major carriers in Asia slated to set up budget airlines next year - Singapore Airlines' Scoot Airlines, Japan Airlines' Peach Airlines and Thai Airways' Smile Air - consolidation in the LCC market could potentially fuel industry growth, he added.

The National Association of Travel Agents Singapore (Natas) and CTC share Mr Bailey's views. CTC's Ms Seah cites the popularity of online booking and LCCs as a definite trend while Natas has seen a rise in the use of the Internet as a means to gather information on travel destinations.

Indeed, travel agencies should tap the mobile booking market in Asia, says Mr Bailey.

'In a region that holds 56 per cent of worldwide mobile users, Asia-Pacific has proven to be a heavy hitter in mobile uptake. Over 2.1 billion people will use a mobile phone at least monthly this year, representing over half the population of the entire region, and growth will be steady,' he highlighted.

Despite the economic uncertainties, the industry prospects aren't too bleak.

'We are seeing more intra-Asian travel, and more foreign visitors to Asia - testament to a great market environment and travel infrastructure, matched with strong tourism efforts that allow for a continued positive outlook for these markets,' Mr Bailey says.

This article was first published in The Business Times.

Travel agencies report pick-up in CNY bookings

By Dolly Chia, The Business Times | Thu, Dec 22 2011

Popular destinations include Taiwan, South Korea and China, particularly with airlines adding new routes to various Chinese cities.

Travel agencies report pick-up in CNY bookings

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