Travel & Tourism - United Arab Emirates

United Arab Emirates

The Travel & Tourism market in the United Arab Emirates (UAE) is expected to witness a remarkable growth in the coming years.
By 2024, the market is projected to generate revenue of US$1,447.00m.
The market is expected to grow annually at a rate of 2.99% between 2024 and 2028, resulting in a projected market volume of US$1,628.00m by 2028.
Notably, the largest market is the Package Holidays market, which is expected to account for a substantial share of the market's revenue.
The Package Holidays market is projected to generate revenue of US$594.60m in 2024, with an estimated number of users amounting to 2,235.00k users by 2028.
In terms of user penetration, the market is expected to witness a growth from 33.0% in 2024 to 33.1% by 2028.
The average revenue per user (ARPU) is projected to be US$457.30.
Furthermore, it is expected that 76% of the total revenue in the Travel & Tourism market will be generated through online sales by 2028.
When compared globally, United States is expected to generate the most revenue in the Travel & Tourism market, with a projected revenue of US$199bn in 2024.
Nonetheless, the UAE is poised to witness a rise in the market, offering numerous opportunities for businesses and investors alike.
The United Arab Emirates' travel and tourism market is experiencing a rise in luxury and experiential travel, particularly in Dubai and Abu Dhabi.

Key regions: Malaysia, Europe, Singapore, Vietnam, United States

Definition:

The Travel & Tourism market encompasses a diverse range of accommodation services catering to the needs and preferences of travelers. This dynamic market includes package holidays, hotel accommodations, private vacation rentals, camping experiences, and cruises.

Structure:

The market consists of five further markets.

The Cruises market covers multi-day vacation trips on a cruise ship. The Cruises market encompasses exclusively passenger ticket revenues.
The Vacation Rentals market comprises of private accommodation bookings which includes private holiday homes and houses as well as short-term rental of private rooms or flats.
The Hotels market includes stays in hotels and professionally run guest houses.
The Package Holidays market comprises of travel deals that normally contain travel and accommodation sold for one price, although optional further provisions can be included such as catering and tourist services.
The Camping market includes bookings at camping sites for pitches using tents, campervans, or trailers. These can be associated with big chains or privately managed campsites.

Additional Information:

The main performance indicators of the Travel & Tourism market are revenues, average revenue per user (ARPU), users and user penetration rates. Additionally, online and offline sales channel shares display the distribution of online and offline bookings. The ARPU refers to the average revenue one user generates per year while the revenue represents the total booking volume. Revenues are generated through both online and offline sales channels and include exclusively B2C revenues and users for the above-mentioned markets. Users represent the aggregated number of guests. Each user is only counted once per year. Additional definitions for each market can be found within the respective market pages.

The booking volume includes all booked travels made by users from the selected region, independent of the departure and arrival. The scope includes domestic and outbound travel.

Prominent players in this sector include online travel agencies (OTAs) like Expedia and Opodo, as well as tour operators such as TUI. Specialized platforms like Hotels.com, Booking.com, and Airbnb facilitate the online booking of hotels and private accommodations, contributing significantly to the market's vibrancy.

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Region

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Analyst Opinion

The Travel & Tourism market in United Arab Emirates has been experiencing significant growth and development in recent years.

Customer preferences: Travelers in the United Arab Emirates are increasingly seeking unique and experiential travel opportunities. They are drawn to luxury accommodations, high-end shopping experiences, and world-class dining options. Additionally, there is a growing interest in sustainable and eco-friendly travel practices among tourists visiting the region.

Trends in the market: One of the prominent trends in the Travel & Tourism market in the United Arab Emirates is the focus on diversifying the tourism offerings beyond traditional attractions. The country has been investing heavily in cultural and entertainment events, such as art exhibitions, music festivals, and sporting events, to attract a wider range of tourists. Moreover, there has been a rise in medical tourism, with the UAE becoming a hub for advanced medical treatments and wellness retreats.

Local special circumstances: The United Arab Emirates benefits from its strategic location as a global transit hub, making it a convenient stopover destination for travelers. The country's world-class infrastructure, including modern airports, luxury hotels, and state-of-the-art attractions, further enhances its appeal to tourists. Additionally, the UAE's tax-free shopping options and diverse culinary scene contribute to its popularity among international visitors.

Underlying macroeconomic factors: The growth of the Travel & Tourism market in the United Arab Emirates can be attributed to several macroeconomic factors. The country's strong economic performance, driven by industries such as oil and gas, finance, and real estate, has created a favorable environment for tourism development. Additionally, government initiatives to promote tourism, such as visa reforms and investment in tourism infrastructure, have played a crucial role in attracting more visitors to the UAE.

Methodology

Data coverage:

The data encompasses B2C enterprises. Figures are based on bookings, revenues, and sales channels of hotels, vacation rentals, cruises, package holidays, and camping.

Modeling approach:

Market sizes are determined through a bottom-up approach, building on a specific rationale for each market. As a basis for evaluating markets, we use financial reports, the Global Consumer Survey, third-party studies and reports, data from industry associations (e.g., UNWTO), and price data of major players in respective markets. To estimate the number of users and bookings, we furthermore use data from the Statista Consumer Insigths Global survey. In addition, we use relevant key market indicators and data from country-specific associations, such as country-related GDP, demographic data (e.g., population), tourism spending, consumer spending, internet penetration, and device penetration. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, ARIMA, which allows time series forecasts, accounting for stationarity of data and enabling short-term estimates. Additionally, simple linear regression, Holt-Winters forecast, and exponential trend smoothing methods are applied. A k-means cluster analysis allows for the estimation of similar countries. The main drivers are tourism GDP per capita and respective price indices.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change.