A look at Mainland China’s hotel performance during the May Day period

According to estimates from the Data Center of the Ministry of Culture and Tourism, the five-day May Day period (1-5 May 2024) brought 295 million domestic tourism trips – a 28.2% jump against the same period in 2019 and a 7.6% increase year over year. However, per capita tourism spending only recovered to 88.5% of the 2019 level.

The hotel occupancy rate index in Mainland China during this year's holiday was not as impactful compared to both 2019 and 2023. The average daily rate (ADR) index reached 112 compared to 2019, but due to factors such as southern rainfall, increased market supply, outbound travel diversion, and precise consumer choices, it only reached 88 compared to 2023. The revenue per available room (RevPAR) index reached 108 compared to 2019, but showed a significant decline compared to 2023.

Similar to last year's travel trends, Mainland China hotels saw their peak occupancy and room rates on the second day of the May Day holiday (2 May). This year's peak occupancy was 90.5%, almost the same as last year's peak of 90.9%. The peak ADR level this year was CNY625, a nearly 28% decrease from last year's peak of CNY865.

Looking at each day of the May Day holiday, the occupancy rate on the first day was basically the same as last year, but from the third day onwards, it was significantly lower than the same period last year. ADR was considerably lower than last year each day of the holiday period. Starting from the second day, room rates fell by more than 10% compared to the same period in 2023.

When looking at hotel class, mid-range and budget hotels showed the most significant ADR growth over 2019, with a rate of 33%. The net growth of luxury hotel room rate was the most prominent. Ultra high-end, high-end, and mid-to high-end hotels also saw an increase of about 15% compared to 2019. Compared to 2023, however, hotel ADR at all levels was lower than the same period last year.

Hot markets in Mainland China

The "reverse tourism" trend became more popular this May Day, with lower-tier markets represented by counties showing outstanding performance. The tourism market's source and destination locations became more diverse, and some previously overlooked cities also saw a peak in visitor numbers. Over 60% of secondary markets had an occupancy rate exceeding 70%.

Cities like Hefei, Tangshan, Xuzhou, Quanzhou, and Hohhot showed significant performance increases compared to both 2019 and 2023.

In contrast to the growth in lower-tier markets, the performance of key cities in mainland China was somewhat disappointing. In terms of occupancy rate, only a few cities (Chongqing, Xi'an, Suzhou, Sanya, Nanjing, Qingdao, and Chengdu) performed better than last year. However, none of the cities exceeded last year’s room rates. With the increase in outbound travel during the holiday period, Macau was the most popular destination, with an occupancy rate index of 116, with Hong Kong also seeing a rise in demand.