We live in what experts call the 'Asian Century', Asia Pacific is now regaining the leading position on the global stage that it last held before the Industrial Revolution.

If the current growth track continues, by 2050, Asia's per capita income could rise 600% in purchasing power parity (PPP) matching Europe and other Western markets. Over the next two decades, perhaps some three billion Asians will enter the ranks of the global middle-class, joining what we term the ‘consuming class' with enormous implications for the global economy.¹

But it's more than pure economic growth that will drive Asia forward at breakneck speed. Geopolitical, social and technological changes will also have a fundamental effect on the region in the future.

Geopolitical and social forces are shaping new trade and business practices that differ from the often centrally-planned and protected economies that exist in much of the region.

Trends such as the greater empowerment of women, the ageing of populations and the drift towards individualism are having a significant effect on entrenched attitudes and behaviours. Moreover, opportunities created by technology and infrastructure developments are profoundly affecting the way that people travel and how they interact with each other, with positive outcomes for the travel industry.

This report analyses the geopolitical, social, economic and technological trends that will have the greatest impact on the travel industry in Asia Pacific over the next 20 years. Primarily, we have sought to understand the implications of changing traveller behaviour on the travel industry – comprising transportation companies (airlines, rail operators and the like), accommodation and entertainment providers and intermediaries such as travel agents.

What we found were "The Big Four Effects" that we believe will help to shape the future of the travel industry. The report covers seven key markets, Australia, China, India, Indonesia, Japan, Korea and Singapore.

Of course, these different effects and the various statistics will be of varying relevance to different elements of the industry and even region – and I would encourage any interested party to review and draw their own conclusions.

The point this research and white paper undeniably highlight, however, are the opportunities that Asia Pacific now has to regain the leading position on the global stage that reaches well beyond travel, but which it is inextricably linked to.

Happy reading!

David Brett
President, Amadeus Asia Pacific

Executive Summary


Our research has identified four dominant themes that will fundamentally change travel in the Asia Pacific region to 2030.

We have described these as "Effects", because each will drive a significant change in the travel ecosystem, with implications for travellers, travel service providers and the industry at large.

The Me Effect
The fragmentation of the travel market into ever-increasing niches.

Travellers across the region will become increasingly distinctive, travelling for a much wider and more specific range of  reasons, and with different aspirations and requirements for the travel experience. While travel in Asia Pacific in the past has often been undertaken in large groups through leisure packages sold in bulk, or in large organised business groups, future travellers will be in smaller groups, or alone, and for a much wider range of reasons.

Significant new traveller segments will emerge, such as the female business traveller, the small business traveller and
the senior traveller, all of which have different aspirations and requirements from the travel experience. Matching this individualism is an increased willingness by travellers to selfmanage their travel, circumventing traditional sources of information and transactional channels in favour of a do-ityourself approach.

The Red Tape Effect
The breaking down of barriers to travel within the Asia Pacific region.

Greater economic convergence and integration across the region will gather pace and governments will continue to liberalise the regulations that have impeded trade, and associated travel. This will be manifested in areas such as the liberalisation of visa requirements and of air travel agreements. The overall impact will be huge growth, not just in the numbers of people that are able to travel, but also in the numbers that need or want to travel.

By 2030, India, China and Indonesia will dominate travel expenditure in the Asia Pacific region, as the impact of the enormous increase in outbound travellers is seen. At the same time there will be shifts in inbound travel markets, especially for business travel whether at the small-to-medium enterprise (SME) or corporate level.

While the main inbound markets such as Singapore, Thailand and Malaysia will remain strong, we expect the highest growth to come from emerging markets, such as China, and from markets that are currently marginal but which will offer huge potential mainly because of their natural resources. In an increasingly resource-constrained world, these will become the new hot-spots for travel. We include Mongolia, Papua New Guinea and Myanmar among these hot-spots.

The Leapfrog Effect
Technology, infrastructure and behaviours in the Asia Pacific region will leapfrog ahead of those elsewhere.

Asia will start to leapfrog existing behaviours in the adoption of newer technologies and infrastructure, giving the traveller new ways to manage the travel experience, creating new behaviours. This will provide new opportunities for travel providers.

The use of mobile devices (smartphones, tablets, etc.) and social media are the obvious findings to become an integral part of the travel experience; however we also refer to transport technologies and infrastructure developments as critical. High speed rail (HSR), 4G networks and port upgrade/builds in the region will enable Asia to leapfrog traditional behaviours elsewhere. Widespread use of mobile devices will change the way travellers behave – using a device to research and make travel arrangements, often at very short notice, gives travellers much greater flexibility but also creates less predictability for travel providers.

And increasingly travellers will use social media as a key tool in the overall travel experience – using social media sites, forums and online communities in the way that travellers in the past have used a travel agent.

While these trends will not destroy the established travel service providers, they will force changes in the way that providers interact with their customers – for example by allowing mobile transactions or transactions through social media sites.

The Barbell Effect
Growth particularly at the upper and lower ends of the travel market.

As economic growth and greater integration occurs, travellers will tend to become more extensive at the upper and lower ends of the economic spectrum. Most travellers from emerging economies will be travelling on a budget – and this will stimulate rapid growth in the budget end of the travel scale, whether in budget airlines or economy hotels.

At the same time, there will continue to be enormous growth in the numbers of the very wealthy in the region, particularly in emerging economies such as China, India and Indonesia.

For these individuals, travel will be a strong element of their discretionary expenditure – and we expect to see significant stimulus at the luxury end of the travel market.

Full report:

www.amadeusapac.com/cmcapac/APACWhitepapers/downloads/Shaping_the_future_of_travel_in_APAC.pdf

Notes:

1. Asian Development Bank (ADB): Asia 2050: Realizing the Asian Century