Tourism price wars threaten China’s consumer spending
SHANGHAI, CHINA – JUNE 29, 2026 – Chinese and foreign tourists visit historical buildings at night near the Bund in Shanghai, China on June 29, 2026. (Photo credit should read CFOTO/Future Publishing via Getty Images)
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China’s domestic tourism market is weakening faster than expected, clouding one of the few bright spots in the country’s sluggish consumer economy.
Hilton China said last week it now expects revenue per available room (RevPAR) to fall by low single digits this year, worse than expectations earlier this year for a flat performance. The hotel group’s RevPAR swung from 1.3% growth in the first quarter, to a 2.2% fall in the second quarter.
“The China economy is sputtering, and I mean it’s growing, but not consistent with what prior growth rates have been,” Christopher Nassetta, President and CEO of Hilton, said in the group’s earnings call on Tuesday, according to a FactSet transcript.
A weekend night in August at a Hilton resort in Dali, Yunnan province, popular with domestic Chinese tourists, runs at $173. But other options recommended on travel booking site Trip.com are less than half the price, with one around $50.
Across China, hotel RevPAR has tumbled 6% year-on-year through late July, following a 1% drop in June, according to Smith Travel Research data cited by Goldman Sachs on Tuesday. That’s after RevPAR rose mildly this spring, the data showed.
A three percentage point drop in occupancy along with a 1% decline in average daily rates versus a year ago dragged down revenue, the Goldman report indicated.
The downturn reflects how China’s post-Covid tourism boom is fading after three years, amid a broader slowdown in the economy and retail sales.
Gary Ng, senior economist at Natixis, noted that there has been a “sharp decline of per-capita spending” on tourism since the third quarter of 2025.
“While tourism is still a bright spot, [it] cannot escape this broad macro trend,” he said, adding that consumers in China increasingly seek more unique or premium experiences, amid slower wage growth.
BAOSHAN, CHINA – JUNE 04: Tourists take photos at a viewing platform overlooking coffee plantations on June 4, 2026 in Baoshan, Yunnan Province of China. Xinzhai Village in Baoshan, known as “China’s First Coffee Village,” has over 70 years of coffee planting history and offers visitors experiences including picking, processing, roasting and brewing. (Photo by Li Jiaxian/China News Service/VCG via Getty Images)
China News Service | China News Service | Getty Images
Trip.com data showed price competition was clear in the three most-popular Chinese regions for travel this summer — Shanghai, Xinjiang and Yunnan.
An August weekend stay in China can cost anywhere from 40 yuan (US$6) to 18,000 yuan (US$2,633) per night, according to a CNBC analysis of Trip.com listings.
One-night stays saw a median price of just 192 yuan (US$28) in Kashgar, Xijiang, 373 yuan (US$55) in Dali, Yunnan, and 595 yuan (US$88) in Shanghai….
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