Holiday resort giant Club Med on growth trajectory

Club Med, the premium all-inclusive operator, expects to continue its growth in the foreseeable future, which will partly be buoyed by the promising China market, its global executive said.

Henri Giscard D'Estaing, president of Club Med, said the global mountain holiday leader "expects to continue to grow this year and next year. "The resort group's growth in the second half of its fiscal year will be in line with that of the first half, "which was already high," he told China Daily in an exclusive interview.

According to Fosun Tourism Group's interim report, the resort business, which is operated under the Club Med brand, delivered dynamic growth in the six months ended June 30. The business volume climbed 5 percent year-on-year to 6.929 billion yuan ($980.6 million) in the period, the report said.

The executive said as Beijing is preparing for the 2022 Winter Olympics, China is expected to see unprecedented opportunities for the development of ice and snow holidays.

Giscard D'Estaing said in the next 10 to 15 years, the country is projected to have the largest number of skiers, which will help boost related industries including holiday resorts. The ski holiday group has attracted more than 23,000 Chinese ski clients this year, according to him.

As part of the group's three-year plan in the China market, three Club Med resorts will be set up in Lijiang, Yunnan province, Taicang, Jiangsu province, and Changbai Mountain in Jilin province.

"All (three) projects have started construction," Giscard D'Estaing said. "The one in Changbai Mountain will open next year."

He did not disclose the investment in the projects.

Liu Wenzheng, an analyst with Essence Securities, said in a recent research note that Club Med would continuously benefit from China's rapidly growing tourism market.

The compound growth rate of the tourism industry in the Asia-Pacific region from 2018 to 2023 is estimated at 7.7 percent, higher than other major destinations, Liu said.

Club Med's strategic priority of "going upscale" has met the demands of rising Chinese middle-income group. The company has offered tailored services to Chinese consumers, such as debuting the city escape program.

Giscard D'Estaing said the China market's remarkable evolution is that consumers have shifted from traveling to spending holidays - a more casual way of relaxation instead of hurrying to different places.

Asked on his take on the industry development amid subdued world economy, Giscard D'Estaing said the upscale market is "most resilient to economic cycles", and that's where Club Med has built in.

"We are confident in the future because as we are positioned on the upscale market," he said, adding that the group will try to manage the uncertainties brought by the economic cycles.

"The Chinese economy is obviously very strong. Domestic consumption is a key driver of it," he added.

jingshuiyu@chinadaily.com.cn

(China Daily Global 10/29/2019 page8)