Hilton to retain expansion pace in China

US-based hospitality company Hilton will maintain its rapid expansion momentum in China and invest more in the country going forward, a senior executive said.

Hilton runs 671 hotels across China as of end-May.

"We are currently the fastest-growing international hospitality company in China; one in every three hotel rooms under construction in China carries the Hilton flag. We have an ambitious growth strategy to seize key opportunities," said Jenny Milos, vice-president of brand management, suites and focused service at Hilton Asia-Pacific.

Milos said Hilton has been opening hotels at a rate of 100 per year in the past five years.

The company is looking to maintain this pace in the foreseeable future with initiatives focused on localization, innovation, diversity and partnership, she said.

"We have full confidence in the future of the Chinese economy and we're very excited about the future investment and development potential across China," Milos said.

In addition to the 10 brands launched in China, the group is in the process of introducing two new brands and thinking of bringing more brands to the country to meet evolving guest needs.

"We have ambitious growth plans to continue expanding in China, especially in key markets, destinations …," she said.

"I think that we will continue to see us double down in the midscale market space for sure. Our vision overall is to have a brand and location at every price point at every stay location for every guest and be everywhere they need and want to be," Milos added.

The confidence stems from a strong Chinese economy, its hospitality market potential and a rising middle-income group.

"When we look forward to the future, we are excited about a new wave of growth across China really anchored around three things: the continued expansion of the middle-income group, rising resident incomes and the continued government structural reform and investments in high-quality initiatives," said Milos.

According to her, the fact that China's GDP rose by 5.3 percent in the first quarter, and that the accommodation and catering sector surged 7.3 percent during the same period show the particular demand for hospitality and travel.

"As a key driver of the global tourism economy, China stands as Hilton's largest market outside the United States and is our fastest-growing, most promising market worldwide. We have confidence in the future of the Chinese economy, and Hilton is committed to investing in and developing the Chinese market," Milos said.

Domestic tourism in the first three months amounted to 1.4 billion passenger trips, soaring 16.7 percent year-on-year, according to the Ministry of Culture and Tourism.

In its 2024 trends report, Hilton said Chinese travelers are more inclined than the majority of their global counterparts to spend more on travel this year than they did in 2023 (85 percent in China versus 65 percent globally), with the country's travel policies continuing to loosen.

Zhao Huanyan, a senior economist tracking the tourism and hotel industry, said the Chinese tourism sector has been on a good development momentum since the beginning of this year, though the hospitality sector is facing more supply than demand.

"Against such a backdrop, it requires hotel operators to establish a clear appeal in their specific segments to survive fierce competition. Hotel groups with greater influence, better recognition and stronger core competitiveness will outperform others," Zhao said.