China Business: Wooing the high value Chinese traveller

Adrian Littlewood, Auckland International Airport CEO, says it's important we make sure we get the right passengers into our country.

China is on the verge of an outward tourism boom as middle-class incomes surge. Already New Zealand has begun to chalk up more business as more high-quality Chinese tourists spend more time (and money) during their visits here.

CLSA reckons that outward tourism boom will gather pace as the country's per capita GDP approaches a tipping point of US$8000, which will lead to a massive increase in discretionary spending power across the Chinese middle-class.

CLSA also forecasts outbound tourism numbers will swell to 200 million annually by 2020 as "what used to be luxury" becomes seen as a common leisure activity by the middle-class.

For Auckland International Airport CEO Adrian Littlewood the "signals and signs are all heading in the right direction, which is fantastic".

Auckland Airport's business is growing rapidly on the back of more Chinese flights. Air New Zealand has a daily service to Shanghai and will later reopen its route to Beijing, this time with a JV partner Air China. China Southern has quickly expanded its daily services out of Guangzhou, and China Eastern has come into the fray with plans to fly from Shanghai four times a week.

"We've got fantastic connectivity coming through," says Littlewood. "Some people have said isn't this a problem to have all this new capacity coming in. But a lot of the Chinese travellers have been trying to get to New Zealand but have been travelling through other ports to get here because there is no capacity on those direct flights. New capacity will actually divert those flights back to direct which will actually have the side benefit of opening up other capacity for other people to come to New Zealand."

Our greatest challenge is the sense that we are full as a country.

Adrian Littlewood

Littlewood reckons many people do not fully appreciate the complete transformation now under way in Chinese tourism. He says there is no shortage of opportunities but it is important to "make sure we get the right passengers into our country".

The signs are promising. A year or so ago, Chinese tourists' average stay was 3.8 days. The most recent figures show it is 7.8 days, spurred along by direct flights. The has also been an increase in FIT (free independent travellers). A couple of years back, 25 per cent of Chinese visitors travelled independently to NZ: now it is around 55 per cent. "They are typically the high-value, high-quality premium tourists," says Littlewood.

With the massive increase in Chinese travellers comes the need to invest more in tourism infrastructure. Chinese investors have recently been to the fore, investing in high-class NZ lodges, hotels like Fu Wah's planned 6-star hotel on Auckland's Viaduct Harbour and Pengxin's acquisition of the Queenstown Hilton. "Our greatest challenge is the sense that we are full as a country," says Littlewood. 'We need to work hard and shift some of that demand into the shoulder seasons."

Auckland Airport is involved with the Ministry of Business Innovation and Employment's tourism partnership programme.

The concept is to build seasonal itineraries for Chinese travellers based around food and wine. "We've already smashed through some early targets with high value and premium customers," says Littlewood. "We are working with companies like Ngai Tahu.

"As part of a welcome package we could send a basket of food and wine to whet the appetite of Chinese consumers while they are at home."

The plans are underpinned by research which shows NZ's high-quality foods and wines are a major attractor for Chinese premium travellers.