Top Biz News

Competition heats up in hotel market

By Ding Qingfen (China Daily)
Updated: 2006-09-27 09:17

Although major hotel chains first began testing the water in China in the early 1980s, it wasn't until recently that they launched aggressive expansion campaigns.

United Kingdom-based InterContinental Hotel Group (IHG) is the most ambitious player.

IHG has a portfolio of 51 hotels in China and plans to develop 74 more by 2008.

Hong Kong's Shangri-La has 20 hotels and plans for 17 more by the 2008 Olympics. While United States-based Marriott has 26 hotels, and plans to swell its portfolio to 35 and 100 by 2008 and 2010.

France-based Accor said this year it has 30 hotels under development in China, all of which are scheduled to open before 2008.

"It is right time to focus on China market," Patrick Imbardelli, chief executive of InterContinental Hotels Group Asia-Pacific, told China Daily during his recent business trip to China.

And Imbardelli isn't the only hotel executive enthusiastic about breaking into China.
"China is Accor's most important market," said Brian Deeson, senior vice-president of Accor Asia-Pacific and chief executive officer of Accor Greater China.

By 2008, Accor will add 70 more hotels to its Asia-Pacific portfolio. New projects in China alone account for 43 per cent of those additions.

Meanwhile, international hotel groups' expansion initiatives are sounding the alarm for domestic firms.

"They pose a great threat to local players as they have many competitive edges  strong branding, more extensive sales and marketing networks and advanced management.

They are also putting a greater emphasis on localization than ever before," said Li Xinjian, professor at the School of Tourism Management at Beijing International Studies University.

"It will be hard for local players to fend off the competition."