Swiss tourism benefiting from stable domestic demand and growing overseas markets in summer
Following a record winter, Swiss tourism will continue to grow this summer. KOF expects overnight stays to increase by 0.4 per cent. The main reasons for this are the brighter outlook for the global economy, rising demand from overseas markets, and stable domestic demand. While the trend in the numbers of guests coming from Europe remains subdued, visitors from the United States and China in particular are providing a boost.
Review of the winter season: Swiss tourism experienced a record winter season in winter 2023/24 and saw an increase of more than 580,000 in the number of overnight stays compared with winter 2022/23 (up 3 per cent). Although KOF had already forecast a record winter, the figures exceeded even KOF’s expectations.
This growth was primarily driven by the influx of European and Chinese tourists. Visits by tourists from Europe delivered stable growth and made a significant contribution to this increase. Overall, however, overnight stays by European tourists are still below their pre-pandemic levels – especially the number of German tourists (down 5 per cent). Overnight stays by Asian tourists – particularly those from China – reached almost half of their pre-pandemic level, exceeding KOF’s forecast. Around a quarter of the total growth was attributable to the increase in Chinese guests (130,000 more overnight stays).
Contrary to initial expectations, the number of overnight stays by domestic guests remained high. KOF had expected to see a stronger decline in the number of Swiss guests owing to greater overseas travel. However, it turns out that more holidays are being taken overall: both long-haul trips and domestic holidays have increased.
Macroeconomic outlook: While the global economy is gradually recovering from its weakness in 2024, the value of the Swiss franc remains a decisive factor for tourism in Switzerland this year. The franc has recently lost some of its strength, which benefits Swiss tourism. This weakening has been supported by the Swiss National Bank’s monetary easing.
The European Central Bank is expected to cut interest rates in mid-2024. Although the Swiss franc has lost some of its value against the euro since the beginning of 2024, an interest-rate cut could weaken the euro against the franc. This would increase the relative costs for European tourists and make travelling to Switzerland more expensive.
On the other hand, the US dollar could strengthen further if the US Federal Reserve (Fed) does not start cutting interest rates until later than we and the financial markets had expected in April. This would make travelling to Switzerland more affordable for American tourists.
Summer forecast: KOF is forecasting growth of 0.4 per cent in overnight stays for summer 2024, which constitutes around 100,000 additional overnight stays. The forecasts for Swiss tourism have been revised slightly upwards, as the numbers of guests coming from the US and Switzerland are stronger than expected and are now seen not as temporary highs but as sustainable growth.
KOF expects to see stronger growth of 2 per cent for summer 2025 compared with 0.4 per cent in 2024. The number of domestic guests has been particularly high in recent summers owing to pandemic-related travel trends. This figure is expected to normalise this summer. Consequently, the growth rate will be higher in 2025.
• Domestic guests: KOF now expects to see a fall of 1.5 per cent instead of the originally forecast decline of 4 per cent. Once long-haul travel by the Swiss population stabilises at a normal level, the number of overnight stays should increase in line with population growth and rise further until 2025. Domestic figures will remain very high overall.
• Guests from Europe: KOF expects to see a decline in travellers coming from Europe during the summer of 2024 as the pre-pandemic long-term negative growth trend in European tourism continues. Our forecast for summer 2024 remains unchanged from our previous forecast (decline of 4 per cent). KOF expects the level of overnight stays to remain roughly the same in 2025.
• Long-haul travellers: Travellers from the US and China in particular stabilised growth in the summer. The number of overnight stays by American guests remains high but has shown little growth. Although the number of Chinese tourists is likely to be well below pre-pandemic levels, their gradual return will contribute to the growth in overnight stays in 2024. In addition, international events such as the 2024 UEFA European Championships in Germany and the Olympic Games in France should boost interest in travelling to Switzerland.
Winter forecast: KOF expects the number of overnight stays during the coming winter season to grow by 190,000, which constitutes an increase of 1 per cent. Compared with our last forecast, which predicted stagnation, these figures represent a slight improvement. This is mainly due to the fact that the macroeconomic outlook is no longer as gloomy as it was at the end of 2023.
• Domestic guests: Modest growth of just under 0.8 per cent is expected for the coming winter and the following year.
• Guests from Europe: Although economic conditions are still not encouraging, they are better than recently assumed. Growth of 0.6 per cent is being forecast.
• Long-haul travellers: The gradual return of Asian tourists will contribute significantly to growth in the winter of 2024. Guests from China in particular are likely to boost growth. Two-thirds of the pre-pandemic level is expected to be reached. The numbers of guests coming from North America are stabilising at a high level.
Contact
KOF FB Konjunktur
Leonhardstrasse 21
8092
Zürich
Switzerland