Leisure Travel Offer Trillions for Stakeholders in 2040
- Business Companies Leisure travel World
Global Business Magazine- 5 minutes read
Leisure travel will present a $15 trillion opportunity for airlines, hotels, and other travel industry stakeholders in 2040, up from $5 trillion in 2024, according to a recent report from Boston Consulting Group (BCG).
The report said that the reasons for this jump are myriad and one of them is the burgeoning middle class in many emerging markets, eager to travel. Another is the growing emphasis on experiences, rather than things—people are increasingly choosing to spend their money on creating good memories.
“Making good memories doesn’t have to mean taking international trips, though it can. Domestic trips compose the bulk of leisure travel, especially in emerging markets. To tap the true potential value of leisure travel, stakeholders should try to attract local and regional tourists as well as international visitors,” the BCG report said.
Travel companies should also prepare for a rapidly evolving customer base, distinguished primarily by shifting demographics. The travellers of the near future are a rich tapestry of identities and preferences.
For example, more and more visitors are coming from emerging markets, including China, India, Saudi Arabia, Bulgaria, and Cambodia. Travelers will also skew younger and embrace digital technologies. Hence travel companies along the value chain should find ways to understand and welcome new travellers while continuing to cater to traditional visitors, the report explained.
Leisure Travel Growth
Leisure travel, measured by the number of overnights, will grow by about 4% annually from 2024 through 2029 and then slow to approximately 3% annually through 2040. Domestic leisure travel makes up the vast majority of overnights, followed by regional travel.
Spending on leisure travel is growing too and BCG expect it to increase by 8% per year through 2029 before slowing to 7% through 2040.
Domestic leisure travel accounted for about $4.1 trillion in spending in 2024, on the strength of almost 13 billion overnights, and BCG has projected that it will pull in about $11.7 trillion in 2040 (approximately 18 billion overnights).
“We expect regional leisure travel to roughly triple from $710 billion (more than 3 billion overnights) to just over $2 trillion (7 billion overnights) in the same time horizon,” BCG said.
BCG further said: “We anticipate that international leisure travel will more than triple from about $425 billion to approximately $1.4 trillion from 2024 through 2040 (rising from almost 2 billion overnights to 5 billion).”
The evolving geopolitical landscape, the US tariffs, and shifting immigration policy may affect travel demand. Some sources have adjusted travel forecasts downward, particularly to and from the US. Changing demand will have both negative and positive implications for travel companies, some destinations might benefit as travellers reroute to different destinations.
Next Wave
The next wave of travellers is coming largely from emerging markets that already have significant leisure travel (domestic, regional, or international) and will show further growth from 2024 through 2040. Prominent among them are China, India and Saudi Arabia. Those from Bangladesh, Bulgaria, Egypt, Morocco, and Vietnam, among other countries, are also part of this group of travellers.
A second wave of travel newcomers is ready to pack their bags and go; though they are starting from relatively low numbers, we expect significant growth. These travellers will come from Bolivia, Malaysia, and Turkey, as well as other countries, the report said.
