DEMAND AND SUPPLY OF HOTEL ROOMS IN TAiWAN (”19:72- 2975 J Thesis for the Degree of M; S. MECHEGAN STATE UNIVERSITY SHENG CHENG CH! 11973 rt ——:“ '2' LIBRARY "1"": Michigan State ; University mum; WI nu 11mm 11m mug up! ABSTRACT DEMAND AND SUPPLY OF HOTEL ROOMS IN TAIWAN (1972-1976) By Sheng Cheng Chi This study attempts to estimate future demand and supply of hotel rooms in Taiwan to provide knowledge for policy making so as to obviate over- or under-construction of hotel rooms. In order to estimate the demand for hotel rooms, it is necessary first to project the visitor arrivals. A number of techniques can be used to make this projection, such as: (l) Gravitation Model, (2) Computer Systems Simulation, (3) Correlation and Regression Analysis, and (4) Time Series Analysis -- Secular Trend. In this study, the secular trend analysis is used to project visitor arrivals in Taiwan be- cause of its simplicity, objectivity and the limitations of data which makes other techniques not applicable. Based on the estimates of demand and supply of hotel rooms in Taiwan, there appears to be an oversupply of about 1500 rooms in 1972. This excess supply may be reduced by an increase in demand in 1973 and 1974. However, an additional 1600 and 4200 rooms might be needed in the years 1975 and 1976 respectively. This analysis suggests that international tourist hotels located in the Taipei region may be more in demand in the future. DEMAND AND SUPPLY OF HOTEL ROOMS IN TAIWAN (1972-1976) By Sheng Cheng Chi A THESIS Submitted to Michigan State University In partial fulfillment of the requirements for the degree of MASTER OF SCIENCE Department of Agricultural Economics 1973 ~ . 2"" 6/ 7 (I) ' ‘ gt} 3 ACKNOWLEDGMENT The author wishes to express sincere gratitude to Dr. Robert D. Stevens, my major professor, for his generous help, guidance, and supervision in the preparation of this study. Without his continuous encouragement, this study would never have been completed. Thanks are also due to Dr. Robert W. McIntosh, and Dr. Lester V. Manderscheid, members of the guidance commit- tee for valuable suggestions on the study. Special thanks are expressed to Mrs. Julia McKay for typing the preliminary manuscripts. Any errors remaining in this study are the sole res- ponsibility of the author. ii TABLE OF Acknowledgment . . . . . . . List of Tables . . . . . List of Figures . . . . . . List of Appendices Chapter 1. INTRODUCTION . CONTENTS 2. TAIWAN'S TOURISM POTENTIAL . I. Taiwan's Strategic Location II. Transportation Within the Country III. Visitor Attractions . . . 3. FORECAST OF VISITOR ARRIVALS I. Choice of Model II. Secular Trend Analysis for Visitor Arrivals in Taiwan . . 4. ESTIMATION OF DEMAND AND SUPPLY OF HOTEL ROOMS IN TAIWAN. I. Estimation of Hotel Room Requirements. . . II. Supply of Hotel Rooms . . III. Comparison Between Demand and Supply. . . . . . 5. SUMMARY AND CONCLUSIONS . . . Bibliography . . . . . . . . . iii Page ii iv vi vii ‘\]\]-¥:'UJUUUUI—’ 13 26 26 39 41 u3 46 Table 10. 11. 12. 13. LIST OF TABLES Summary of R2 for Three Secular Trend Models for Visitor Arrivals in Taiwan . . . . . Visitor Arrivals in Taiwan, Actual and Forecast to 1976 . . . . . . . . . . . . . Seasonal Fluctuations of Visitor Arrivals in Taiwan, 1969‘1971 o o o o o o o o o o o 0 Hotel Requirements by Foreign Visitors in Taiwan, 1968 . . . . . . . . . . . . . . . . Average Length of Stay by Foreign Visitors in Taiwan, 1968 . . . . . . . . . . . . . Estimated Length of Stay by Foreign Visitors in Taiwan, 1972—1976 . . . . . . . . . . . . Foreign Visitor Arrivals in Taiwan by Party Size, 1968 . . . . . . . . . . . . . . Summary of N.Q.L.S.M.R.P. Values for Predic- tions of Visitor Arrivals in Taiwan, 1972-1976 . . . . . . . . . . . . . . . . . Estimated Demand for Hotel Rooms by Foreign Visitors in Taiwan, 1972-1976, Allowing Occupancy Rate of 70% . . . . . . . . . . . Average Hotel Occupancy Rate in Taiwan by TOUI‘iSt Regions, 1968‘1970 o o o o o o o o 0 Average Occupancy Rate by Class of Hotels in Taiwan, 1968-1970 . . . . . . . . . . Length of Stay by Foreign Visitors in Taiwan and Regions Visited, May-September, 1968 . Supply of Hotel Rooms in Taiwan, As of January 1,1972 . . . . . . . . . . . . iv Page 16 24 29 31 31 32 33 34 35 36 37- 38 39 Table 14. 15. 16. 17. Estimated Supply of Hotel Rooms in Taiwan, 1973 . . . . . . . . . . . Estimated Supply of Hotel Rooms in Taiwan, 1974 . . . . . . . . . . . Estimated Supply of Hotel Rooms in Taiwan, 1972—1976 . . . . . . . . Estimated Excess/Shortage of Hotel Rooms in Taiwan, 1972-1976 . . . . Page 40 40 41 42 Figure 1. LIST OF FIGURES Japanese Visitor Arrivals in Taiwan, Actual and Estimated to 1976 . . . . . United States Visitor Arrivals in Taiwan, Actual and Estimated to 1976 . Asian Visitor Arrivals in Taiwan, Actual and Estimated to 1976 . . . . . . European Visitor Arrivals in Taiwan, Actual and Estimated to 1976 . . . . . . Canadian, Australian and New Zealand Visitor Arrivals in Taiwan, Actual and Estimated to 1976 O O O O O O O O O O 0 All Other Visitor Arrivals in Taiwan, Actual and Estimated to 1976 . . . . . . Total Visitor Arrivals in Taiwan, Actual and Estimated to 1976 . . . . . . Seasonal Fluctuations of Visitor vi Page .17 18 19 2O 21 22 23 3O LIST OF APPENDICES Appendix 1. Taiwan's Geographical Relationship (1) . . 2. Taiwan's Geographical Relationship (2) . . 3. Taiwan's Principal Travel Corridors and Visitor Attractions . . . . . . . . . . . 4. Map of Taiwan by Tourist Regions . . . . . 5. Prediction Equations for Visitor Arrivals in Taiwan, From Six Sub-Markets. . . . . . 6. Japanese Visitor Arrivals in Taiwan, Actual and Estimated to 1976 . . . . . . . 7. United States Visitor Arrivals in Taiwan, Actual and Estimated to 1976 . . . . . . . 8. Asian Visitor Arrivals in Taiwan, Actual and Estimated to 1976 . . . . . . . 9. European Visitor Arrivals in Taiwan, Actual and Estimated to 1976 . . . . . . . 10. Canadian, Australian and New Zealand Visitor Arrivals in Taiwan, Actual and Estimated to 1976 . . . . . . . . . . . . 11. All Other Visitor Arrivals in Taiwan, Actual and Estimated to 1976 . . . . . . . vii Page 47 48 49 5o 51 52 53 54 55 56 57 CHAPTER 1 INTRODUCTION Taiwan, a country of great constrast, has not until recently become a tourist attraction. The importance of tourism to Taiwan's economy can be seen from its tourism revenue. In 1971 alone, Taiwan's revenue from tourism amounted to $114.5 million, which ranked number four in Tai- wan's export industry. "Economists agree that demand for non-essentials such 2 as tourism tends to be quite elastic." Elasticity of de- mand in the tourist industry is shown not only by its pecu- liar sensitivity to fluctuations in personal income, but also to changes in the cost of tourist goods and services. On the other hand, "Supply in the tourist industry is essentially rigid."3 Personal services are created at the time of consumption. Most tourist activities consist either 1Taiwan Tourism Bureau, Monthly Report on Tourism. (Taipei: 2Robert W. McIntosh, Tourism Principles, Practices, Philosophies. (Ohio: GRID. Inc., 1972), p. 207. 3Kurt Kraft, "Tourism as a Factor in Economic Development", Igtgrnational Travel and Tourism. (Washington, D.C.: Institute of Certifiemeravel Agents, 1967), p. 81. in providing services or in transforming goods and selling them to consumers. Successful tourism requires certain spe- cialized installations which are generally costly, i.e., hotels, restaurants, transport services, etc. Most of these cannot be moved in response to a demand suddenly arising at some other places. Immobility in time and space of tourist services are the causes of this almost total inelasticity of supply.)4 This difference in the nature of demand and supply in the tourist industry will always be one of its crucial pro- blems. It is for this reason that the forecast of tourist demand is needed. Decisions have to be taken now about hotel constructions costing millions of dollars which will not be usable for some years ahead. This study attempts to estimate future demand and supply of hotel rooms in Taiwan to provide knowledge for policy making so as to obviate over- or under-construction of hotel rooms. 4Kraft, p.82. CHAPTER 2 TAIWAN'S TOURISM POTENTIAL This chapter will briefly review Taiwan's tourism po- tential and factors favorable to Taiwan's tourism development. I. Taiwan's Strategic Locationl The geographical location of Taiwan is one of its major assets. It is strategically located on one of the most frequently travelled routes in Asia (Appendix 1 and 2). Taiwan lies in direct line between Japan and Hong Kong, Asia's most active tourist playground. Tokyo is 1300 miles to the northeast of Taipei and Hong Kong 500 miles to the southwest. Flying time to Hong Kong is just over one hour and to Tokyo is slightly over three hours by jets. Because of this loca- tion, Asian tourists can include a Taiwan stopover for no additional air fare. Opening of Kaohsiung Airport to inter- national traffic will reduce the flying distance to Hong Kong to 300 miles. II. Transportation Within the Country2 Mobility is the most important key to tourism devel- opment in Taiwan. Taiwan presently has an improving internal lTaiwan Tourism Bureau, Taiwan Visitor Industry Summary, (Taipei: 1971), p. 21. 2lhid. p. 8. 4 transportation structure consisting of domestic air travel, railways and highways (Appendix 3). Internal air travel is currently provided by China Airlines, Far Eastern Air Transport and Winner Airlines. Domestic service extends nearly the length of the island from Taipei to Kaohsiung. International airports also serving domestic flights include airports at Taipei and Kaohsiung. Priorities with respect to tourism development and decentra- lization include Hengchun and Taichung airport development. Railway in Taiwan play an important part in both pas- senger and freight traffic. There are two major railroad trunklines in Taiwan with one each on the west and the east coasts. The Taiwan Highway Bureau, the governmental agency res- ponsible for roads, currently has a long range program of new highway construction plus improvement plans for existing roads. Priority is being given to the construction of a north-south freeway between Keelung and Kaohsiung. III. Visitor Attractions3 Taiwan offers a multitude of attractions and activi- ties for visitors of many diversified interests, but most important is that Taiwan is the only part of China generally open to world travellers today. In Taiwan, the visitor can acquaint himself with authentic Chinese tradition, art, festi— vals and celebrations, cuisine, architecture and way of life. 3 Taiwan Tourism Bureau, Taiwan Visitor Industry Summary, (Taipei: 1971) p. 13. 1) Hospitality Resources Many visitors consider the people of Taiwan to be the island's greatest visitor attraction. Thousands of years of traditional family education on customs has ins- tilled a hospitality in the people. Another quality of the people is expressed in the ability of foreign visitors to move about freely by day or night in all areas of the cities without harm or fear for personal safety. One of Taiwan's most important hospitality resource is the island's remark- able storehouse of Chinese culture and art, the National Palace Museum in Taipei. The museum is a visual experience enabling visitors from throughout the world to experience the beauty and story of Chinese culture and art. 2) Natural Resources The island of Taiwan possesses spectacular scenic beauty in its wooded and rugged mountains. Natural features such as the Taroko Gorge and the rock formations of Yehliu, mountain lakes and reservoirs such as Sun Moon Lake, rugged coastlines and picturesque rural farming villages surrounded by rice paddies and other agricultural settings. The visitor can-experience tropical, sub-tropical, temperate and alpine climatic zones in a short space of several hours. In addi- tion to scenic and cultural attractions, Taiwan offers the visitor a range of Sports and recreational activities, such as golf courses, beach facilities, boating, surfing and underwater sports (For locations of principal visitor attrac- tions, see Appendix 3.). 3) Shopping Shopping opportunities for unique and reasonably priced items are one of the major attractions for visitors to Taiwan. The important visitor shopping items include or- namental marble products, jade and coral jewelry, wood and stone carving, rugs, etc. Shopping in Taiwan is a sight- seeing adventure in itself. 4) Dining and Entertainment The Chinese restaurant has become a world-wide institution. Taiwan offers the finest, most authentic Chi- nese cuisine available. The major cities of Taiwan also pro- vide a wide range of night life and entertainment. The eve- ning entertainment includes the traditional Chinese opera, classical Chinese symphony and orchestra concerts, plays and folk dance shows. The traditional songs and dance perform- ances of the aborigines also provide a touch of local flavor. CHAPTER 3 FORECAST OF VISITOR ARRIVALS This chapter will attempt to develop a forecast of visitor arrivals to Taiwan. I. Choice of Model In order to estimate the demand for hotel rooms, it is necessary first to project the visitor arrivals. There are a number of different techniques which might be used in making this projection, such as (1) Gravitation Model, (2) Computer Systems Simulation, (3) Correlation and Regression Analysis, and (4) Time Series Analysis -- Secular Trend. l) Gravitation Modell The logic of the Gravitation Model is based on the concept that a specific and measurable relationship exists between the number of visitors arriving at a given destination from specific markets and a series of independent variables, the most important of which are: a) the magnitude of the population of the market area, b) the distance between the destination and that market. Other independent variables - such as the income of the residents of the market area, 1L. J. Crampon, "A New Technique to Analyze Tourist Markets", International Travel and Tourism, (Washington, D.C.: Insti- tute of Certified Travel—Agents, 1967), pp. 239-243. 7 the average age of the residents of the market area, and the general propensity of the residents to travel - can be in- jected into the model. The relationships among these variables can be ex- pressed by the equation: b3 b3 Vod = b1PoTod = b2VdPoTod Where: Vod = the number of visitors from a given market area or origin, 0, visiting a given destination, d P0 = the population of o Tod = the travel distance between 0 and d Vd = the total number of visitors to d from all origins The values of bl, b2 and b3, the constants, must be computed: bl: the value of Vod/Po when Tod is equal to one ‘2 b1/Vd b3: the slope of the exponential curve The gravitation model is a tool that can be applied to evaluate markets that can serve a destination -- that is, a nation, a state, a community, or an individual attraction. However, a model that considers only the population of a market and the distance between the market and destina- tion leaves something to be desired. By using various esti- mates of tourists'propensities to travel, which vary from one market to another, or by injecting additional independent variables into the model, the precision of the estimates can 9 be improved. The difficulties being "the injection of addi- tional independent variables", which can be quite tedious and causes bias created by personal judgment. 2) Computer SystemsSimulation Model2 A Computer Systems Simulation is one of the methods for projecting demand. There are two features of primary significance in this approach. First the prediction of tourism demand at the destination is broken into two phases. Phase one involves the use of observed participation rates at the origin correlated with socio-economic data to give estimates of future demand at the origin. Phase two consists of predicting the probable future distribution of this demand at the destinations by simulating the flows of visitors on the computer with the model appropriately modified to re- present future conditions. The second feature of this approach is that the com- puter simulation takes into consideration all of the demand at all the origins simultaneously and distributes to the destinations. It is a dynamic model of a dynamic situation. The model consists of three basic groups of compo- nents: (1) origin countries, (2) destination countries, and 2Michael Chubb, "'RECSYS-SYMAP' — Michigan's Computerized Systems Simulation Approach to Demand Distribution Predic- tion," Predictinngecreation Demand (East Lansing: Recrea- tion Research and Planning Unit, Michigan State University, September, 1969), pp. 23-33. lO (3) the transportation link in between. Origin Transportation Link Destination Country "A" Flow of Visitors Country "B" In constructing the computer systems model, simula- tion equations are written based on the principle that: Thed ndfrnl'nk=Px 11 ema ( o a y l ) Resistance of the link where P is the propensity to participate at the origin. The resistance of a link is defined as a function of distance and cost. Look at just four countries to see the possible com- binations of linkages: ’A A C > Lil Here there are a total of 12 possible direct flow routes. This means 12 equations to be solved in the model. In the complete model, the number of origins, desti— nations, possible direct flow routes and so the equations to be solved can be quite fantastic. 11 There are obviously some problems with the technique. It requires especially trained personnel to set up the ori- ginal model and data processing programs. It also requires a large amount of special data. These are serious problems that have to be faced by any tourism organization that might consider using the computer systems simulation method. 3) The Correlation and Regression Analysis3 The statistical tools of correlation and regres— sion analysis were developed to estimate the closeness with which two or more variables were associated and the average amount of change in one variable that was associated with a unit increase in the value of another variable. A general linear model would look like this: Y = BOXo + Ble + B2X2 + "° + Bka + e where the dependent variable Y (number of visitors) is the function of xi (1 = O, l, 2, ..., k) Xi's are the independent variables representing the various factors affecting Y, such as GNP, distance, popu- lation, etc. Bi's (i = 0, l, 2, --. k) are the constants e is the error term The use of a correlation and regression model would have many of the same problems as a computer systems 3William A. Spurr and Charles P. Bonini. Statistical Analysis for Business Decisions (Illinois: Richard D. Irwan, Inc., 1967), pp. 551—630. Ibid. p. 551. 4 12 simulation model. Especially trained personnel and large amount of special data would be required. These three models described above are all based on the concept that a specific and measurable relationship exists between the number of visitors arriving at a given destination from specific markets and a series of indepen- dent variables. These models will not be used in this study for the following reasons: (1) All three models above require large amount of specific data, which would require accurate information on visitor arrivals during the past. Also, future conditions of the destination and originating area have to be accu- rately modified. Unfortunately, Taiwan's visitor data is scanty and not always accurate. It is new in the tourist industry and not many studies on foreign visitors to Taiwan have been conducted. It would be hard to estimate with great accuracy future arrivals of foreign visitors. (2) The number of calculations needed in all three models can be quite fantastic based on the number of ori- gins which can feed visitors to each of the various desti- nations. Many sophisticated approaches to demand distribu- tion prediction are severely handicapped because they became too complicated. 4) Time Series Analysis -— Secular Trend5 Secular trend is the gradual growth or decline of a series over a long period of time. 5William A. Spurr, pp. 463-497. 13 The secular trend analysis is used to estimate visitor arrivals to Taiwan for the following reasons: (1) This analysis uses data readily available. There- fore, time and cost for data collections are saved. (2) This analysis uses a "time" proxy for all indepen- dent variables affecting visitor arrivals in Taiwan, thereby eliminating most errors created by subjective judgement ex- cept the selection of sample period. (3) Computer test runs of the regression models show very high.%x>efficient of determination", which suggests that the regression lines fit the observed data very well. II. Secular Trend Analysis for Visitor Arrivals in Taiwan This section will discuss the set up and the condi- tions of the secular trend model for visitor arrivals in Taiwan. 1) Data Used and Period Under Study Data for visitor arrivals in Taiwan by nationali- ties are available only from 1962 through 1971, therefore, only ten years' data are used in these projections. Because of the limitations of the data, only short term projections of visitor arrivals up to 1976 are made. 2) Assumptions The projections are based on two basic assumptions: (1) Political and economical stability through- out the world in general, and in Taiwan and in countries supplying visitors to Taiwan in particular. l4 (2) Factors affecting visitor arrivals to Taiwan will remain the same during the period under study as during the sample period. 3) Market Groups Tourists from different originating countries are believed to have different spending patterns and pursuits. In order to make projections more accurate and for the esti- mations of hotel room requirements, the market is divided into six sub-markets. These market groupings are based on each country's unique characteristics or the similarities amongst the countries within the same group. The six sub-markets are as follows: (1) Japan: Japanese visitors constituted 26% of all visitor arrivals in Taiwan in 1964 and increased to 47% in 1971. It is by far the largest market for Taiwan's tourist industry. (2) U.S.: U.S. visitors constituted almost half of the total visitor arrivals in Taiwan in 1962, and had been the number one market for Taiwan's tourist industry until 1967 when Japan took her place. U.S. is now the second largest tourist market for Taiwan. (3) Asia (Excluding Japan): This market includes Ryukyu, Philippines, Thailand, Vietnam, Korea, and Malaysia. This market constituted about 9-13% of the total visitor arrivals in Taiwan in the period 1962-1971. l5 (4) Europe: This market includes Belgium, France, Germany (FR), Italy, Netherlands, Spain, Switzer- land, United Kingdom. European visitors have not constituted an important market for Taiwan's tourist industry, only 3% in 1971. (5) Canada, Australia and New Zealand: This market grouping is based on many similarities of these three countries. They have very high GNP per capita and are relatively new market for Taiwan. This market constituted about 2-5% of the total visitor arrivals in Taiwan in the period 1962-1971. (6) All Others: This market group includes all coun- tries and areas not listed in the preceding five markets. This market constituted about 13-23% of the total visitor arrivals in Taiwan in the period 1962-1971. 4) Regression Models The models use "visitor arrivals" from each sub- market as dependent variables, and "time" as independent variables. Three least square regression models are used in the analysis of secular trend for each sub-market: a) Yi = A1 + BiX + e b) Y1 = A1 + six + 01x2 + e c) log Y1 = A1 + BiX + e Where: K: II market X = the time variable, X 16 X X l for 1962 2 for 1963 15 for 1976 i represents different sub-markets i = 1 represents Japanese market 1 O 2 represents U.S. market i e 6 represents All Others A, B, and C are the constants e is the error term the number of visitor arrivals from each sub- The regression equations with largest R2 are selected for prediction (Table 1). Asia, and All Others Markets. Model b is selected for Japan, Model c is selected for U.S., Europe and C. A.,and N.Z. markets. 2 Table 1. Summary of R for Three Secular Trend Models for Visitor Arrivals in Taiwan* Sub-Markets C.A. All Japan U.S. Asia Europe and Others Models N.Z. a .9004 .9574 .9743 .9571 .7824 .9315 b .9913 .9635 .9784 .9821 .8008 .9501 c .9700 .9737 .9071 .9880 .9161 .9464 *Result of computer run feeding data Taiwan during 1962-1971 into models a), b) and c). of visitor arrivals in l7 .mnma ou pmumewumm can Hmnuomucmzflma ad mHm>Huu< Houflmfi> mmmcmmmn||.H wuswflm new» mu mm. 3. mm Nb .2. on mm mw be mm mm vm mm mm AL b . p F p . s p P _ _ p . b} OCO~H va.mhmv :N.mvmvv Caulvhaoav mama. H mm .Nxmm.vmmm + xmm.womm I Hm.NoamH mam>auu¢ Houses Ill 7 1.08.03 mam>fluu¢ I empowcwum \x\\ .23 £082 .835 - .xkfix .Emflusoe c0 uuoawm hanucoz \\\\.\ .smwusm Swansea cmzflma "meadow r 6:! 23.80; SIEAIIIV JhosTA go JeqmnN 18 .mwma Op ooumEHumm tam Hmnpodncmzflma CH mam>wnu4 Houfimw> mmumum pmuficalu.~ magmam new» p p b p b p _ p . P # Mm mm vh mu Nu an on mm mm mm ow mm vw mm Amvoo.ov Ammmo.ov smsm. u m .xeeeo.o + mesm.e u a sea N mam>HHH¢ \\ pmuoflpmum \\\ .\\\ .msma .souoz .aoaame m\\\\\. .Emfiusoa no uuommm hanpcoz \\ .smmunm Emwnsoa cmzflws "mousom 1 mm ooo.a I H.ooo.ooa stentxxv JoqtstA go JeqmnN 19 .mbma OD woumaflumm was Hmsuogicmzwma cw me>HHu¢ Houflmfl> swamdll.m mHsmHm ooo.H use» i me me as me up as as so me he so me as me me Asm.soav Amm.samav lam.mammv \ x l amem.o u m . xe~.emH . xom.eamm + H~.smm~- u m» N N mampauum pmuowpmnm “‘| ‘ .mema .eoaoz .aoaame .Emflusoa co uuomwm manucoz .smmnsm Emwusoa cm3flma "condom I III! 000.00H sIeATJJV JoqtstA go Jeqmnu 20 .ceea or wouweflumm can Hmsuo4nnm3fima cw mam>wund nonwmw> :womousmnu.v muzmwm H00» a me as me me as on me me so we me as me me Ar p N . . s _ . L P b p _ _ Goes-H f Aemoo.ov Anamo.ov u ommm.o u «m .xammo.o + ~moe.m u em.ooa . I u: ooo.oa mao>auam oouoaooua\\\\i. $ \\\\ F \\\\\ .meea .souoz .aoaaoe - \ .EmHHSOB :0 phenom manucoz u .5mmunm Emwusoa sesame "mousom W m: ooo.ooa 4x SIEAIJIV JoqtstA 30 Jeqmnu 21 .whmd Ou poumfiflumm cam Hmzuofi scmzflma cw mam>wuum nouwmw> panacea 302 can unflamuumsd .cmwcmamuni.m muamwm new» m5 Vb mm mm Hp _oh mm am pm mw mm vw mm - n b n s h “moao.ov Amhmo.ov 0 II 0 o Ilm \, Haas o I mm .xmmoa o + Hmmm m n m mod _N w \\\\ mam>wuu4 wouoflpmum \\ .msma .souoz .aoaaoe .Emflusoa co uuommm masucoz .dmmusm Emfludoa cm3flma “condom Nw ooo.H SIPAIIJV xoqtsTA go JeqmnN 22 .mnma on woumeumm paw Hmsuodlam3wma :H mam>fluH¢ HouflwwD “mayo HH¢II.m onsmflm new» mm mu #5 m5 mm as on mm mm hm mm mm P p b . F P b . — . . r Aoo.mmmv Anm.moovVAmN.vmmmv Homm. n m . xmo.mbm + xwm.Ohmm + Ah.mmm N N mam>fluud cwuoapwnm mam>flnu¢ amsuoé \\\\ .33 ions: Sesame \ .Emflusoe no uuommm masucoz .sowusm Swansea cmBHma "condom sIeATIIV IOQISTA go IaqmnN 23 A Actual Arrivals .________—_———- Predicted Arrivals 1,ooo,ooo_r X x” a ” .4 . ' Tot/I - Source: Taiwan Tourism Bureau, ’,2’ 7 Monthly Report on Tourism, I,” ‘ March, 1972 ’2’ I’,, “¢”” - 3923’ 60”, U) , thgr'”’ H m > a 100,000 —. . H é / C.A.NO 8 ' ’4: u ASLa ...... I '5’ -r-1 4’ m a” 'H > w Europe 0 H é’ o 2 1,000 7 1 v T ‘ T f v 1 T T ‘ > 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 Year Figure 7.--Total Visitor Arrivals in Taiwan-Actual and Estimated to 1976. 24 Therefore, the prediction equations, the actual and estimated visitor arrivals from each market (Figures 1-6, 6 also appendix 5-11) and the total arrivals (Table 2, Figure 7) follow. Table 2. Visitor Arrivals in Taiwan: Actual and Forecast to 1976 Markets Japan U.S. Asian European Year 1962 6,070 25,954 5,310 3,398 1963 10,848 33,085 8,066 4,645 1964 21,519 38,754 13,031 5,114 1965 38,499 47,843 17,858 6,715 i, 1966 54,306 62,963 23,982 8,310 g 1967 72,063 71,044 33,808 10,012 “ 1968 103,229 76,188 34,865 13,286 1969 143,624 97,932 37,497 15,050 1970 177,446 121,745 45,685 19,684 1971 255,699 111,444 44,615 19,552 1972 300,457 157,299 50,412 27,467 E, 1973 364,826 186,828 53,772 33,648 g 1974 435,644 221,900 56,882 41,219 5 1975 512,913 263,556 59,744 50,494 1976 596,631 313,032 62,357 61,856 6The predicted numbers of total visitor arrivals in Taiwan are the total of visitor arrivals from six sub-markets. 25 Table 2. (Continued) Markets Canadian Australian Others World Total Year N. Z. 1962 2,602 8,970 52,304 1963 3,148 12,232 72,024 1964 3,077 13,986 95,481 1965 5,304 17,807 133,666 * 1966 7,253 26,134 182,948 g 1967 6,351 59,970 253,248 :3 1968 11,969 62,233 301,770 1969 13,471 63,899 371,473 1970 22,810 85,082 472,452 1971 14,279 94,166 539,755 1972 25,928 113,479 675,043 14, 1973 32,817 130,607 802,498 g 1974 41,536 148,879 946,060 5 1975 52,573 168,294 1,107,574 1976 66,541 188,854 1,289,271 *Taiwan Tourism Bureau, Monthly Report on Tourism, Taipei, March, 1972. ' **From Prediction Equations. Note that the predicted numbers of total visitor arrivals in Taiwan are the total of visitor arrivals from six sub-markets. CHAPTER 4 ESTIMATION OF DEMAND AND SUPPLY OF HOTEL ROOMS IN TAIWAN This chapter will estimate the demand and supply of hotel rooms in Taiwan, and make comparisons between demand and supply to see if there are excess or shortage of hotel rooms . I. Estimation of Hotel Room Requirements This section will estimate the hotel room require- ments from the projections of visitor arrivals. Planning future accommodation requirements on the basis of projections of tourist traffic is a difficult and hazardous task. There are many variables involved in esti- mating hotel room requirements from forecasts of future tourist trade. The demand for hotel rooms depends essentially on the following factors: 1) Estimated number of visitors 2) The number of visitors requiring hotel accommodation lMichael Peters, International Tourism, (London: Hutchinson 8c Co., 1969), p. 16; Also see Loke Jame Won , Demand and Supply of Hotel Rooms in Singaporep(l970-l975 , (Singapore Tourist Promotion Board, 1969), p. 17. 26 27 3) The length of their stay in hotels 4) Total number of nights spent in the country 5) The average number of hotel guests accommo- dated in an occupied room 6) Seasonal flow characteristics 7) Locations of the stay To ensure that there are enough rooms to accommodate visitors the whole year round, it is necessary to calculate the minimum number of hotel rooms required for the maximum number of visitors who require hotel accommodations in any one day/night. A daily census of potential hotel guests is necessary, but this is too tedious a task. However, it is not unreasonable to expect that the maximum demand for hotels will occur during the peak period of visitor arrivals. For Taiwan, there has been no marked seasonality of visitor arrivals. Still, during the period 1969-1971, arrivals in October averaged about 10% of total arrivals and were higher than the monthly average for the year (Table 3, Figure 8). It is noted that there were peaks within the peak period, however, it would probably be to- tally uneconomical to make completely adequate provision for exceptional peaks.2 Hence, the average 10% expected visitor arrivals in October will be used to estimate the number of visitors requiring hotel accommodations. 2Peters, p. 166. 28 Hence, the formula used in calculating hotel room re- quirements for each market group of arrivals is: Where: H N x S x Q x L/P x M x R - - - - Formula 1 the number of hotel rooms demanded the total number of visitor arrivals from each market expected during the year (Table 2) the percentage of visitors expected to arrive during the peak month of October, for reasons discussed previously, 10% is used in this study 'the percentage of visitors requiring hotel room accommodation. The data provided by Tourism Council of Taiwan (Table 4) are (used in this study ”the number of days in the month. October is the peak month, therefore, M is 31 in this case the average length of stay per visitor,data provided by tourism council are used (Table 5) 29 .11 .tha «hawscwh «Hoafime namahoos no paoawm hanpcoz asmonsm Emaasoe adzawe "monsom mma.mmm Ham.oe mmm.we :mm.om smm.zm mmmama Heme mma.mse :am.om mas.me som.ma mmm.:m smm.ma came mea.aem Hma.om sea.sm moa.ma mme.om sea.wm mama Meow Hmpoa .oom .>oz .poo .paom .ws< Spec: mmm.mm mow.oa Hmm.sa mmm.s: mma.:a mam.om mma.sm Heme msm.ma mma.mm mos.aa www.me ama.sm mom.am Hmm.Hm came osm.mm mom.sm msm.am mms.mm ms:.om mmo.mm mmm.mm mama ammw mach warm he: .sm< .amz .pom .th nese: Hama-moma .casaoe ca massaaaa aouama> ao soapaouosaa Hosoaoom .m oases 3O .HbmHlmmmH .cm3wma cw mam>wuu¢ Houamw> mo mcowumsuosam accommomul.m ousvwm cases 000 >02 #00 new 55¢ Hub can he: nae H82 non can mmma .mnma humsqmn .Hoaflma .Emfiusoe co uuomom hanucoz .omonsm Emflunoa cm3flma “Condom T V T —' T I' o ooocoa ooo.om ooo.om ooo.ov 000.00 000.00 sIeATJJV JoitstA go Jaqmnu 31 Table 4. Hotel Requirements by Foreign Visitors in Taiwan, 1968 Market Groups* % Yes** % No*** Japan 96 4 U. S. 92 Asia (excluding Japan) 90 10 Europe 95 5 Canada, Australia & New Zealand 100 0 All Others 92 8 Source: Survey of Tourism in Taiwan, 1968, Tourism Council, Taiwan. *Calculated into market groups as defined in this study. **Inc1uding hotels and other paid accommodations ***Inc1uding on board ships, friends, relatives, etc. Table 5. Average Length of Stay by Foreign Visitors in Taiwan, 1968 Market Groups* Length of Stay (days) Japan ”-93 U. s. 4.82 Asia 8.00 Europe 4.75 Canada, Australia & New Zealand 3.60 All Others 8.00 Source: Survey of Tourism in Taiwan, 1968, Tourism Council, Taiwan. *Calculated into market groups as defined in this study. 32 These lengths of stay are expected to be shortened.3 There- fore, slight adjustment downward are made (Table 6). Table 6. Estimated Length of Stay by Foreign Visitors in Taiwan, 1972-1976* Market Groups Length of Stay (days) Japan 4-5 U. s. 4.5 Asia 7-5 Europe 4.5 Canada, Australia, New Zealand 3.5 All Others 7.5 *Derived from Table 5. R - the number of persons per occupied room Unfortunately, no survey of this type has been made. However, examining the visitor arrivals by party size (Table 7), grounds are found for estimation. Assuming those who travel alone stay in one room alone, those who travel with a spouse are expected to stay in one room together. Family travel usually involves younger children, there might be more than two persons in one room. Group travel could contain singles, doubles, and 3L. J. Lickorish, "What Will be the Shape of Future Markets", International Travel and Tourism, (Washington, D. C.: Ins- titute of Certified Travel Agents, 1967), p. 221. 33 families. Based on Table 7, approximately 60 to 70 rooms are needed for every 100 visitors. Therefore, R is assumed to be 1.5 for all markets. Table 7. Foreign Visitor Arrivals in Taiwan by Party Size, 1968 Size Alone Spouse Family Group Unreported Percent 37.84 10.82 12.55 35.25 3.54 Source: Annual Report on Tourism Statistics, 1968, Tourism Council, Taiwan. P = the occupancy rate for the month. The room requirements at the occupancy rate of 70 percent are calculated. Values for N, Q, L, S, M, R and P are summarized in Table 8. Applying these values into Formula 1, the estima- ted demand for hotel rooms by foreign visitors are obtained (Table 9). 4According to: Survey of Hotels in Taiwan, Breakeven occu- pancy rate for average hotels is 55%, and a 70% occupancy rate will bring reasonable profit to hotels. .ocwmsozp pmoawoc mnp op mmo confides was m_z How mosam>* N. u m m.H u m Hm u S OH. H m whimbma humane: HH< m.s mm. mmH m.m H so m.H mm. mm m.e om. mo m.H mm. mHm m.H mm. smm msmH ml m.» mm. mmH m.m H mm m.: mm. om m.a om. 00 m.a mm. 00m m.H mm. mHm msmH m.» mm. mHH m.m H m: m.: mm. H: m.» om. em m.H mm. mam m.H mm. mm: HemH m.s mm. HmH m.m H mm m.: mm. Hm m.s om. Hm m.a mm. smH m.H 0m. mom msmH m.s mm. mHH m.m H mm m.: mm. em m.s om. om m.a mm. amH m.H mm. oom msmH H 0 H0000 H 0 A00 0 H a A0000 H a A0000 H 0 Hooov H a A0000 same 2 z 12 z z *z maocuo HHH .N.z e .H.0 odoasm mama .m.p seams mpoxamz osmH-msmH «szHmH CH mHm>HHH< HopHmH> mo mCQHpoHomam How moSHm> .m.m.2.m.q.d.z mo massesm .w oHpmH 35 .H stsHom opca m mHQmB CH spec wcHhHaam Soap oo>HHoQ* ems.mH moo: one HHm mmmH mamm moms msmH mmH.oH 00mm 05m 0mm HHNH mmmm momm msmH 0mm.mH smHm mm: mmm HwHH mmmm mmsm asmH eHm.HH mean mmm or: mHHH samm Ham: msmH mao.oH Hmmm 0mm mmm amOH mmmH Hmmm msmH stow H0000 oaocpo HH< .N .z s .< .0 oaoasm on< .m .: c0000 mpoxsmz pamoaom on mo opmm mocwasooo wQHBQHH< «@NmHumhmH «£83089 CH mHopHmH> cwfiosom an mEoom Hopom How camera oopmeflpmm .m oHQmB 36 By examining occupancy rates by regions5 (Table 10), occupancy rates by class6 (Table 11), and the length of stay and tourist regions visited by foreign visitors (Table 12), it is obvious to see that International Tourist Hotels located at Taipei region were more in demand. These Table 10. Average Hotel Occupancy rate in Taiwan by Tourist Regions, 1968-1970 Year Taipei Central Southern 1968 79.85 64 53 1969 72.57 60 58 1970 86.06 55 49 Source: Taiwan Tourism Council, Survey of Hotels in Taiwan, 1971. Note: Data for Eastern Region not available. 5For purpose of this study, the island of Taiwan is divided into four tourist regions, namely, Taipei (Northern), Central, Southern and Eastern Regions. (See Appendix 4). 6 There is no official classification of hotels in Taiwan. However, according to: Questions and Answers About the Tourist Hotel Construction of the Republic of China, Inter- national Tourist Hotels have a minimum of 40 rooms, (Usually they have 200 rooms or more.) Room rate averages about US$18.00 per person per night. Tourist Hotels have a mi- nimum of 20 rooms. Room rate ranges about $8-15 per person per night. 37 trends are expected to continue as the Charter Inclusive Tours develop and the length of stay shortens.7 These group tours usually prefer to stay in large International Tourist Hotels.8 Unfortunately, no data on the locations of visitor stay is available, therefore, regional breakdown of demand for hotel rooms is not possible. Table 11. Average Occupancy Rate by Class of Hotels in Taiwan, 1968-1970 Year International Tourist Hotels Tourist Hotels 1968 74.73 56.29 1969 73.40 54.02 1970 76.40 57.99 Source: Taiwan Tourism Council, Survey of Hotels in Taiwan, February, 1971. 7Taiwan Tourism Bureau, Survey of Hotels in Taiwan, (Taipei, 1971), p. 29. 8Ibid. p. 29. 38 .mmmH «Homawa .wmmH «sesame CH Emflasoe mo hm>Hsm «HHooooo emausoa cwszB "moasom oo.om oo.mm oo.om 00.00H om 1 mH mm.:H mm.mm Ha.» Hm.wm mH 1 0H m0.am sa.mm mH.m Hm.mm m - s HH.MH m:.om ww.: 00.00H m u m mm.m mm.mH mm.m mH.mm H 0H.» ma.sH HH.H mm.mm m ms.o mH.H mm.m mm.mm m o ma.o mH.H om.Hm H CQHwom :Hopmmm oopHmH> COmem Coammm Coawom Ammmov hepflfioo whopHmH> Gaogpoom oopHmH> Heapcoo oopHmH>. HomHeB ompHmH> CH zmpm psooaom mHopHmH> psoosom mHopHmH> pflooaom mHopHmH> unmoaom. mo newcmq wwma «Hensopmomuzmz «oopHmH> mCOHwom use sesame CH mHOPHmH> cwHoHom he zmpm mo cproH .mH oHQmB 39 II. Supply of Hotel Rooms This section will estimate the supply of hotel rooms in Taiwan. As of January 1, 1972, there were 120 licensed hotels with a total of 11,523 rooms in operation, among which 74 hotels with 7862 rooms were located in the Taipei region (Table 13). Table 13. Supply of Hotel Rooms in Taiwan, As Of January 1, 1972 International Tourist Tourist Total Regions Hotels Hotels ‘7Hotels Rooms Hotels Rooms Hotels Rooms Taipei 10 3152 64 4710 74 7862 Central 2 119 16 1074 18 1193 Southern 4 697 20 1562 24 2259 Eastern 1 87 3 122 4 209 Total 17 4055 103 7468 120 11,523 Source: 1. Monthly Report on Tourism, January 25, 1972, Tourism Bureau, Taiwan. 2. Monthly Bulletin, May 1, 1971, Taiwan Visitor Association, Taiwan. In addition, four new hotels have been approved for development and four other hotels (existing) are being 9 extended. 9Taiwan Tourism Bureau, Monthly Report on Tourism, January 25, 1972, Taipei. 40 By the end of 1972, there will be 122 hotels with 12,499 rooms in operation (Table 14). By the end of 1973, 124 hotels with 14,549 rooms will be available (Table 15). Estimated supply of hotel rooms for the period 1972-1976 are summarized in Table 16. Table 14. Estimated Supply of Hotel Rooms in Taiwan, 1973 International Tourist Tourist Total Regions Hotels Hotels Hotels *Rooms Hotels Rooms Hotels Rooms Taipei 12 4128 64 4710 76 8838 Central 2 119 16 1074 18 1193 Southern 4 697 20 1562 24 2259 Eastern 1 87 3 122 4 209 Total 19 5031 103 7468 122 12499 Source: See Table 13. Table 15. Estimated Supply of Hotel Rooms in Taiwan, 1974 International Tourist Tourist Total Regions Hotels Hotels Hotels Rooms Hotels Rooms Hofels ’Rooms Taipei 14 6178 64 4710 78 10888 Central 2 119 16 1074 18 1193 Southern 4 697 20 1562 24 2259 Eastern 1 87 3 122 4 209 Total 21 7081 103 7468 124 14549 Source: See Table 13. 41 Table 16. Estimated Supply of Hotel Rooms in Taiwan, 1972—1976* Year NUmber of Hotels Number of Rooms 1972 120 11,523 1973 122 12,499 1974 124 14,549 1975 124 14,549 1976 124 14,549 Source: Table 13, 14, 15. *Assuming no more construction after 1974. III. Comparison Between Demand and Supply This section will compare the estimated demand and supply of hotel rooms in Taiwan to see if there are short- ages or excesses of supply. From the estimates made in Sections I and II of this Chapter (Table 9 and Table 16), there appears to be an over- supply of hotel rooms in 1972. This excess supply may be reduced by an increase in demand in 1973 and 1974. New constructions or expansions appear to be needed after 1974. The analysis suggests an additional 1600 and 4200 rooms will be needed for the years 1975 and 1976, respectively (Table 17). The possible oversupply of about 600 rooms in the years 1973 and 1974 may be eliminated by increasing occupancy 42 rate by 3%. This may be achieved through additional inter- national promotions and marketing aiming at bringing con- ferences, seminars and meetings of various nature in Taiwan. The estimated shortage of 1600 rooms in the year 1975 suggests an additional three 500-room or eight 200-room hotels might be needed in the year 1975. The possible shortage of 4200 rooms in the year 1976 suggests that addi- tional eight 500-room or twenty-one 200-room hotels might be needed in the year 1976 if the assumptions hold. Table 17. Estimated Excesses/Shortages of Hotel Rooms in Taiwan, 1972—1976* Year Supply Demand Excess(+)/Shortage(-) 1972 11523 10042 +1481 1973 12499 11917 + 582 1974 14549 13936 + 613 1975 14549 16193 -1544 1976 14549 18724 —4172 *Derived from Table 9 and Table 16. CHAPTER 5 SUMMARY AND CONCLUSIONS The demand for tourism is quite elastic, and the supply of tourist facilities is somewhat inelastic. This difference in the nature of demand and supply in the tourist industry will always be one of its crucial problems. There- fore, forecast of tourist demand should help improve decision making. Decisions have to be taken now about hotel cons- tructions costing millions of dollars which will not be usable for some years ahead. This study attempts to estimate future demand and supply of hotel rooms in Taiwan to provide knowledge for policy making so as to obviate over- or under—construction of hotel rooms. Taiwan's geographical location is one of its major assets. Taiwan lies in the direct line between Japan and Hong Kong, Asia's most active tourist playground. Taiwan presently has an improving internal transportation structure consisting of domestic air travel, railways and highways. Taiwan offers a multitude of attractions and activities for visitors of many diversified interests. 43 44 In order to estimate the demand for hotel rooms, it is necessary first to project the visitor arrivals. There are a number of techniques to make this projection, such as: l) Gravitation Model, 2) Computer Systems Simulation, 3) Cor- relation and Regression Analysis, and 4) Time Series Analysis -- Secular Trend. The secular trend analysis is used in this study because of its Simplicity, objectivity and the limita- tion of data which makes other techniques not applicable. In order to make projections more accurate, improved techniques are needed. The computer systems simulation seems to be most promising. Once the model is set up, each year's visitor arrivals from each market can be easily estimated. However, this model requires a large amount of specific data' -— through collections of visitor entry/exit data and a variety of detailed surveys. Therefore, research of this type should be carried out by government or other large organizations. The projections show that the total visitor arrivals in Taiwan may reach 1.3 million in 1976. By then, Japanese might form the bulk of the arrivals —- 46%. Based on the estimates of demand and supply of hotel rooms in Taiwan, there appears to be an oversupply of hotel rooms in 1972. This excess supply may be reduced by an in- crease in demand in 1973 and 1974. The possible oversupply of about 600 rooms in the years 1973 and 1974 may be eliminated by increasing occupancy 45 rate by 3%. This may be achieved through additional inter- national promotions and marketing aiming at bringing con- ferences, seminars and meetings of various nature in Taiwan. The estimated shortage of 1600 rooms in the year 1975 suggests that additional three 500-room or eight 200-room hotels might be needed in the year 1975. The possible short- age of 4200 rooms in the year 1976 suggests an additional eight 500—room or twenty-one 200-room hotels might be needed in the year 1976 if the assumptions hold. Unfortunately, no survey of visitor locations of regional stay is available. Therefore, regional demand for hotel rooms can not be reasonably estimated. The high occu- pancy rates for Taipei region and high occupancy rates for International Tourist Hotels suggest that International Tourist Hotels in Taipei region were more in demand. Large group tours are indicated as the trend for the future; these large groups usually prefer to stay in large International Tourist Hotels. As the length of stay shortens, these visitor regional stays might even center more in the Taipei region. All these points suggest that Inter- national Tourist Hotels in the Taipei region may be more in demand in the future. BIBLIOGRAPHY Chubb, Michael and others. Predicting Recreation Demand. East Lansing: Recreation Research and Plannin Unit, Michigan State University, September 19 9. Gray, H. Peter. International Travel-International Trade. Massachusetts: D.C. Heath and Company, 1970. McIntosh, Robert W. (ed). Readings Book, International Travel and Tourism. Washington, D.C.: Institute of Certified Travel Agents, 1967. . Tourism Principles, Practices and Philosophies, Ohio: GRID, Inc., 1972. Mendenhall, William. Introduction to Linear Models and The Design and Analysis of Experiments. California: Wadsworth Publishing 00., 1968. Peters, Michael. International Tourism. London: Hutchinson & Co., 1969. Spurr, William A. and Charles P. Bonini. Statistical Analysis for Business Decisions. Illinois: Richard D. Irwin, Inc., 1967. Taiwan Tourism Bureau. Annual Report on Tourism Statistics. (yearly), 1968—1971. Taipei, 1968—1971. . Monthly Report on Tourism.. January 1971- October 1972. Taipei, 1971-1972. Questions and Answers About the Tourist Hotel Construction of the Republic of China. Taipei, 1970. Survey of Hotels in Taiwan. Taipei, 1971. Survey of Tourism in Taiwan, 1968. Taipei, 1969. . Taiwan Visitor Industry Prpgram Summary. Taipei, 1971. Taiwan Visitor Association. Monthly Bulletin. January 1971- August 1972. Taipei, 1971-1972. Wong, Loke Jame. Demand and Supply of Hotel Rooms in Singa- pore (1970-1975). Singapore Tourist Promotion Board, 1969. 46 APPENDIX 47 'Okinawa 1,750 miles Guwn “..“llll‘ii;fiqw€ Djakarta ............... Source: Taiwan Tourism Bureau,'Taiwan V181t0r Industry 'Summary, (Taipei: 1971) p. 9. Appendix l.-—Taiwan's Geographical Relationship (1). 48 .Amv awnmcoflumaom Hmowsmmumoow m.cmsflmanl.~ xfipsommd .m.a AHan “Homflmav .MHmEEsm mmumsccH HouHmH> sesame .smousm Emwnsoa sesame “monsom \ 9 43:65.. ‘7. On. 0900 \ a HE sHaHssomnw . omom HE can. mmmnonos.n mu 49 Taroko Gorge Taichung Taiwan Strait 1.4% ....... Pacific Ocean Tropic of Cancer Kaohsiung 0 ++H4-Railroad 9! Highway .dk International Airport a? International Seaport Mi 40 80 120 L 1 IL I {P Domestic ' ' Airport Source: Taiwan Tourism Bureau, Taiwan Principal V331§or Inipstry Summary, (Taipei: A Visitor I :1 ' p. ‘ Attractions Appendix 3.--Taiwan's Principal Travel Corridors and ' Visitor Attractions. 50 Taipei Region Central Region Taichung Southern Region Taitung .Kaohsiun: Appendix 4.--Map of Taiwan by Tourist Regions. Appendix 5. Japan: Asia: Europe: Prediction Equations for Visitor Arrivals in Taiwan from Six Sub-Markets, 1972-1976* 2 El 0 18102.91 - 9806.35X + 3224.99X2, R = .9913 (10174.44) (4249.27) (376.46) A 16g Y2 = 4.3748 + 0.0747x, R2 = .9737 (0.0269) (0.0043) ‘9 3 = -2937.21 + 6216.90x — 124.26x2, R2 = .9784 (2915.31) (1217.55) (107.87) .A log Y4 = 3.4692 + 0.0881x, R2 = .9980 (0.0213) (0.0034) Canada, Australia and New Zealand: All Others: 2 A. log Y5 = 3.2881 + 0.1023x, R .9161 (0.0679) (0.0109) 96 = 586.71 + 3970.36X + 572.05x2, R2 = .9501 (9594.28) (4006.97) (355.00) *Result of Computer Run Source: Taiwan Tourism Bureau, R.O.C. 51 Appendix 6. Japanese Visitor Arrivals in Taiwan, Actual and Estimated to 1976 1 x Y1* Y1** Year Time No. of Visitors Estimated No. of Visitors 1962 1 6,070 11,521 1963 2 10,848 11,390 1964 3 21,519 17,708 1965 4 38,499 30,477 1966 5 54,306 49,696 1967 6 72,063 75,364 1968 7 103,229 107,483 1969 8 143,624 146,051 1970 9 177,446 191,070 1971 10 255,699 242,538 1972 11 - 300.457 1973 12 - 364,826 1974 13 — 435,644 1975 14 - 512,913 1976 15 - 596,631 *Source: Taiwan Tourism Bureau, R.O.C. A 2 2 **Y1 0 18102.91 — 9806.35X + 3224.99x , R = 0.9913 (10174.44) (4249.27) (376.46) 52 Appendix 7. EAE.EZ%:;:p:dAigiyg%g in Taiwan, Actual X Y2 ‘32 Year Time No. of Visitors* Estimated No. of Visitors** 1962 1 25,954 28,155 1963 2 33,085 33,441' 1964 3 38,754 39,719 1965 4 47,843 47,175 1966 5 62,963 56,031 1967 6 71,044 66,550 1968 7 76,188. 79,043 1969 8 97,932 93,881 1970 9 121,745 111,505 1971 10 111,444 132,437 1972 ll - 157,299 1973 12 - 186,828 1974 13 - 221,900 1975 14 — 263,556 1976 15 - 313,032 *Source: Taiwan Tourism Bureau, R.O.C. 0.9737 A **1og Y2 = 4.3748 + 0.0747x (0.0269) (0.0043) 2 R 53 Appendix 8. Asian Visitor ArriVals in Taiwan, Actual and Estimated to 1976 x Y3 93 Year Time No. of Visitors* Estimated No. of Visitors** 1962 1 5,310 3,155 1963 2 8.066 8.999 1964 3 13,031 14,595 1965 4 17,858 19,942 1966 5 23,982 25,040 1967 6 33,808 29,890 1968 7 34,865 34,492 1969 8 37,497 38,845 1970 9 45,685 42,949 1971 10 45,615 46,805 1972 11 — 50,413 1973 12 - 53,772 1974 13 - 56,882 1975 14 - 59,744 1976 15 - 62,357 *Source: Taiwan Tourism Bureau, R.O.C. A **Y3 = -2937.21 + 6216.90x — 124.26x2, R2 = .9784 (2915.31) (1217.55) (107.87) 54 Appendix 9. European Visitor Arrivals in Taiwan, Actual and Estimated to 1976 x Y4 . 34 Year . Time No. of Visitors* Estimated No. of Visitors** 1962 1 3,398 3,609 1963 2 4,645 4,421 1964 3 5,114 5,416 1965 4 6,715 6,634 1966 5 8,310 8,127 1967 6 10,012 9,956 1968 7 13,286 12,196 1969 8 15,050 14,941 1970 9 19,684 18,303 1971 10 19,552 22,422 1972 11 - 27,467 1973 12 - 33,648 1974 13 — 41,219 1975 14 — 50,494 1976 15 - 61,856 *Source: Taiwan Tourism Bureau, R.O.C. **log 9, = 3.4692 + 0.0881X 22 — 0.9880 (0.0213) (0.0034) - 55 Appendix 10. Canadian, Australian and New Zealand Visitor Arrivals in Taiwan, Actual and Estimated to 1976 X Y, 75 Year Time No. of Visitors* Estimated No. of Visitors 1962 1 2,602 2,457 1963 2 3,148 3,110 196AL 3 3,077 3,936 1965 4 5,304 4,982 1966 5 7,253 6,306 1967 6 6,351 7,982 1968 7 11,969 10,103 1969 8 13,471 12,787 1970 9 22,810 16,185 1971 10 14,279 20,485 1972 11 - 25,928 1973 12 - 32,817 1974 13 - 41,536 1975 14 - 52,573 1976 15 - 66,541 *Source: Taiwan Tourism Bureau, R.O.C. 2 (0.0679) (0.0109) 56 Appendix 11. All Other Visitor Arrivals in Taiwan, Actual and Estimated to 1976 X Y6 YB Year Time No. of Visitors* Estimated No. of Visitors** 1962 1 8,970 5,129 1963 2 12,232 10,815 1964 3 13,986 17,646 1965 4 17,807 25,621 1966 5 26,134 34,739 1967 6 59,970 45,002 1968 7 62,233 56,410 1969 8 63,899 68,961 1970 9 85,082 82,656 1971 10 94,166 97,496 1972 11 - 113,479 1973 12 - 130,607 1974 13 — 148,879 1975 14 - 168,294 1976 15 — 188,854 *Source: Taiwan Tourism Bureau, R.O.C. **§6 = 586.71 + 3970.36x + 572.05x2, R2 = 0.9501 (9594.28) (4006.97) (355.00) 57 "‘11111411111115: