Intercontinental Hotels Eyes China Expansion

Intercontinental Hotels Group PLC (IHG) has recently indicated that it expects China to account for up to a third of the company´s global expansion over the next three years, which involves adding up to 60,000 net new rooms.

In a recent interview, the group´s chief executive Andrew Cosslett said that much of the growth in China will be spurred by domestic travel partly linked to the mainland´s massive road building scheme.

With its booming economy, China is at the core of London-listed Intercontinental´s development plans in the Asia-Pacific region, and will likely become its third largest market in 10 years after the US and the UK, according to Cosslett. The company reportedly is aiming to manage 125 hotels in China by the end of 2008, a near threefold rise from the current levels.

“We have a very clear focus in China. There is definitely going to be very significant growth in the chain hotels sector in that market, driven by rising domestic tourism,” Cosslett reportedly said. “We´re seeing a lot of parallels in China with the U.S. in the 1950s, when major cities were linked up by what became the world´s largest road network.”

In August this year, during the Travel Distribution Summit in China, an Intercontinental Hotels Group´s spokesperson noted the company is the largest international hotel operator in China and it still needed more rooms in key cities of Shanghai, Beijing and Hong Kong, as its hotels are over capacity.