Taiwan’s hotel industry is in the midsts of a recession, but is it really a result of Chinese tourists staying away? Formosa International Hotels Corp chairman Steven Pan as early as 2013 became concerned, at the time pointing out that there was a permanent oversupply of tourist hotels in Taiwan. Pan warned that the situation would become even more serious by 2017 and predicted the market was about to enter a period of sharply reduced profits and intense competition between brands. Pan’s words have proved extremely prescient.
At the time, Pan pointed out that Taiwan’s tourism industry had been booming for many years and this had led many hoteliers and innkeepers to expand investment. With supply in the market continuing to build, Pan became concerned a consolidation of mid-range hotels and inns would take place once meager profits began to bite and that only the most high-end and low-end hotels would remain relatively unscathed.
At this year’s annual shareholder meeting, Pan stated that the economic cycle for Taiwan’s hotel industry typically lasts seven-to-10 years and said he believes the next four-to-five years will be painful for the industry.
By comparison, Pan is bullish about the health of the wider Asian region’s hotel market and cites Thailand, Vietnam, Indonesia and Japan as examples. Pan says growth in Thailand, Vietnam and Indonesia’s markets is extremely robust and said the Japanese market is also in good health, where Pan says he is currently in discussions on five separate projects.
Source article: http://www.taipeitimes.com/News/lang/archives/2017/10/10/2003680028
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