TUI: More than doubling the number of hotels – that’s behind the big Asia plan

After more than a quarter of a century in the world of tourism, Sebastian Ebel has seen everything there is to see, one would think. But the CEO of global travel market leader TUI sounds genuinely enthusiastic when he reports on his recent trip to Vietnam and China.

“When I think of Shanghai: it was green, it was incredibly clean, it was completely technological: I saw self-driving cars and super-modern port facilities. You didn’t have to queue anywhere – all processes were digitalized and all meetings were extremely organized,” said Ebel on the evening before the travel company’s annual press conference in Hanover a few days ago. “China is a very structured country – so it was really impressive.”

What the TUI boss knowingly leaves out: China is a country that monitors its citizens at every turn, that suppresses any form of opposition and does not shy away from violence. It also threatens Taiwan with violent annexation. Anyone who wants to do business in China cannot talk about it openly.

Ebel was also surprised by something else: “The respect with which Germany is spoken of there.” With business partners in China, “our reliability, our quality standards, our work attitude are considered exemplary,” says Ebel: “I never had that anymore expected.”

The fact that Germany apparently enjoys such a good reputation in East Asia is an important condition for the expansion plans. “The TUI Group is continuing its growth in the Far East,” announced Ebel in WELT AM SONNTAG. Asia is becoming a “strategic growth area” for the group. In the future, the region will play a major role in the goal of broadening the customer base and distributing it more globally, says Ebel. “This will also make us more independent from Europe, where the economy has recently stalled.”

The world market leader in package holidays is breaking new ground: of the 430 TUI hotels, only 18 are in Asia, most of them in the Maldives and Thailand. The total number is expected to more than double in the next three years with an additional 22 hotels. “In the medium term,” i.e. by the early 2030s, “I think a three-digit number of hotels in Asia is realistic,” he says. The projects would be implemented together with local partners through management and franchise agreements.

Indonesia and other countries are also on the agenda

The group only opened its first three hotels in China this year. But nine further projects under the TUI Blue brand name have been signed. In 2025, new TUI Suneo brand hotels are also scheduled to open in China for holidaymakers who prefer something cheaper. Further hotel projects are being built in Indonesia, Cambodia, the Philippines and Vietnam. “We make vacation offers for guests from Europe in the Far East and become a provider for travelers from Asia who are vacationing in the region,” said Ebel.

The growing middle class and the increasing demand for high-quality holiday offers make the region so interesting for the tourism industry. According to an analysis by management consultancy McKinsey, the domestic Chinese travel market is already the second largest in the world with a volume equivalent to $744 billion. With annual growth of twelve percent, China’s domestic market will overtake that of the USA by 2030. Currently, 30 percent of all new hotel buildings worldwide are being built in the People’s Republic.

The trend is towards high-priced offers: According to McKinsey, twice as many hotels in the luxury segment will be built in China as in the USA. After the Corona travel restrictions were lifted, China’s citizens learned to appreciate traveling, but preferred nearby destinations within the country or in neighboring regions.

The “China Outbound Tourism Research Institute” (Cotri) in Hamburg confirms the trend. Malaysia is the top travel destination for Chinese, followed by Singapore, South Korea and Japan. Trips to the special administrative regions of Hong Kong and Macau also fall under the foreign travel chapter in Chinese statistics.

The violent suppression of civil protests in Hong Kong initially led to a decline there since 2019. Meanwhile, Cotri boss Wolfgang Georg Arlt notes, both special administrative zones account for 50 percent of all foreign trips from the Chinese heartland. For the full year 2024, Cotri expects around 100 million trips abroad by Chinese people – which would correspond to around 60 percent of the pre-Corona level in 2019.

Chinese citizens are traveling overseas significantly less than before the pandemic. The number of Chinese tourists in Germany only reached 56 percent of the 2019 level in the third quarter. There were 40 percent fewer Chinese tourists in the USA than in the same quarter of 2019. The reason for the low number of long-distance trips can also be attributed to the current economic crisis in China be. Chinese foreign tourism is growing “slowly but steadily,” believes Cotri director Arlt.

TUI’s growth on the Asian market is probably also due to the fact that tourism groups from the People’s Republic have not remained idle and are pushing forcefully into western markets. The Chinese conglomerate Fosun took over the well-known French resort brand Club Med in 2015. The hotel operator Deutsche Hospitality, with brands such as Steigenberger, IntercityHotel and Maxx, has been part of Huazhu since 2019, which now operates under “H World International” and wants to expand massively outside of its home market of China.

Daniel Wetzel is a business editor in Berlin. He reports on Energy industry, Energy policy and Climate policy.