For the first time, more overnight stays than before the Covid-19 crisis thanks to the return of Asian customers

According to tourism forecasts published by BAK Economics on behalf of the State Secretariat for Economic Affairs (SECO), the number of overnight stays in Switzerland in summer 2023 will again exceed the level before the 2019 crisis, i.e. 22.5 million. (+660,000, +3% compared to 2022). The reasons for this positive development are the revival and catch-up effects of distant markets, in particular from Asian visitors, and a still high domestic demand despite the expected decline. High inflation and a heavy economic environment prevent even stronger growth.

Continued growth in overnight stays in summer 2023

With 22.5 million overnight stays, Swiss tourism will register an increase of 3% (+660,000) during the 2023 summer season compared to the previous year. The positive impulses from distant markets will exceed the declines recorded in Europe and Switzerland. Thus, the 2019 level will be exceeded for the first time during the summer months (102%). Demand in the cities will also exceed the pre-crisis level in summer 2023, which will largely close the gap observed during the crisis with the Alpine regions and the rest of the country.

A drop in European demand is expected for the summer of 2023…

The obstacles already observed last winter should persist next summer and thus curb the desire to travel. High inflation reduces purchasing power, the strong Swiss franc puts pressure on prices and economic turbulence weighs on consumer sentiment. This will affect demand from European tourists in the summer of 2023. The possibility of traveling again to distant countries is further detrimental to Swiss tourism development. Compared to the good summer of 2022, BAK Economics therefore expects a reduction of almost 160,000 tourists (-3%) next summer. The high cost of plane tickets, which makes distant destinations less attractive, and the significantly higher inflation in Europe than in Switzerland, which reduces the pressure on prices, prevent a more pronounced decline. The only positive impulse in Europe for the summer will come from the United Kingdom with a strong increase in overnight stays (+11% compared to 2022).

… but the influx of visitors from distant countries will be preponderant…

As far as distant markets are concerned, the possibility of traveling again should be widely exploited during the summer of 2023, as was the case last winter. We must therefore expect lasting catch-up effects. In total, distant markets should record a marked increase in overnight stays of 37% (+1.6 million) compared to summer 2022.

Catch-up effects are particularly important for certain Asian markets. Thus, demand from India (+343,000 compared to summer 2022) and other Asian markets (+465,000) should increase in particular. The Chinese (+264,000) and Japanese (+116,000) markets also made a significant contribution to the growth in overnight stays. Despite the lifting of most of the strict travel restrictions earlier this year, the return of Chinese tourists is still expected in the short term for various reasons. On the demand side, these are the frequent lack of travel documents for Chinese citizens, the limited number of visas and the continued change in travel behavior of Chinese customers, who turn to domestic tourism. . On the supply side, bottlenecks in transport (eg the number of flights and customer quotas with tour operators) or among tourism providers in Switzerland limit growth potential. A return of Chinese tourist numbers to 2019 levels would simply not be sustainable in the short term on the supply side. This problem is reinforced by the persistent shortage of qualified personnel in the tourist sectors.

As far as tourists from the United States are concerned, the sustained demand in recent months suggests that the desire to travel should not be dampened in summer. Compared to the already good summer of 2022, an increase of 142,000 overnight stays (+9%) can be expected.

…and domestic demand is still high despite an expected decline

The return of international travel should have a negative impact on domestic demand next summer. However, the past year has clearly shown that the increase in domestic demand is not just a temporary phenomenon that took place during the years of acute crisis. This is why, compared to the excellent summer of 2022, a decline that is certainly perceptible but not massive in domestic demand is expected (-800,000, -7%). With just over 11 million overnight stays, domestic tourism is still well above the 2019 level (+13%).

In the medium term, Europe is expected to lose market share and distant markets to gain

For the years 2024 to 2030, BAK Economics assumes that the trends observed before the Covid-19 crisis will mostly be relevant again. There will certainly still be catch-up effects from certain countries, in particular China, but these will not influence the overall evolution of overnight stays to the same extent as in recent years.

For European markets, the structural changes observed before the crisis, and therefore the negative evolution of the trend, will continue after the crisis. Therefore, the European market will constantly lose market share.

On the other hand, the opposite is expected for distant markets: the dynamic growth before the Covid-19 crisis should again be reproduced, in particular for the other Asian markets, India and the United States. For China, because of the factors mentioned above, and for Russia, because of the sanctions that will probably still be in place for a long time, a drop in momentum is to be expected compared to the years preceding the crisis. All in all, distant markets are expected to gain significant market share.

Regarding the demand of the Swiss in their country, BAK Economics assumes that around 10% of the level difference between now and 2019 will remain unchanged. From this new, higher starting level, domestic tourism is expected to grow with a somewhat slower dynamic, but similar to that before the crisis (at just over 1% per year).