Financial Crunch Puts a Global Grip on Tourism this Holiday Season
The typical hustle and bustle of the holiday season around the world is missing this year due to the current economic climate. Since the US economic plunge hit, many travelers (business and leisure) throughout the world have scaled back. The global financial crisis has put a halt on the majority of travel around the world. The problem isn't the capacity for travel, the problem is creating the demand and need for it again despite current economic conditions. Rome is one of the many cities around the globe seeing a dramatic decline in hotel occupancy.
Rome felt a 17.5 percent decline in October compared with the same month last year. In addition to hotel occupancy, global air travel has also fallen as the economic crisis takes a toll on the world economy.
The International Air Transport Association (IATA) said that international passenger traffic had decreased 1.3 percent in October compared with the previous year. As we all know, business travel helps drive both airline traffic and hotel occupancy rates. Whether for conferences held on site at hotels and resorts or at facilities elsewhere, airline traffic and hotel occupancy go hand in hand for business travel.
Premium air travel hit low in north Atlantic markets, between the US and Asia across the Pacific, and within the Middle East. Luxury brand five-star hotels, such as The Grand Hotel Plaza in Rome are also feeling the pinch. Other global cities are feeling this same pinch when it comes to hotel occupancy. Guests are looking for more affordable accommodations while they are traveling and are overlooking some of the high end properties that were once sought after.
When major global cities such as Hong Kong, Los Angeles, Madrid, New York, Paris, Toronto and Sydney start to feel the pinch - we know we are in the midst of tough times.
What's to come in 2009 is unknown at this time, however, we can only be optimistic that there will be change coming. In the meantime, we can continue to work with hotel executives to ensure budgets are in tact, existing furniture on property is maintained and guest relations continues to be a priority for those that are embarking on travel this holiday season.
Labels: economy, Hospitality, travel
posted by TRT Blog on
Tuesday, December 9, 2008
at
1:58 PM
2 Comments:
Madrid has certainly seen a downturn in both advance travel bookings as well as in rates that the hotels are able to command. Whilst it is true that a lot of this is due to the "Credit crunch" there are some additional factors:
1, Spain in general having become a very expensive destination compared to the "up and coming" Eastern European countries and cities.
2, Cultural tourism is on the up and people are now trying to pack in more "unique" experiences instead of simply visiting a city.
3, Madrid remains more expensive than other Spanish cities due to business demand during the week. Alternatives such as Santander, Valencia and Bilbao have recently received better and more air links.
All the above is based on the experience of the domestic market which www.madrid-guide-spain.com allows us to gather.
Thank you for your comment and insight on the travel industry. Advance travel bookings have clearly declined and a primary reason would be due to economic uncertainty. However, you're right the credit crunch isn't the only catalyst for change in the industry. There are so many other factors that affect travel. Your points are all valid as well as interesting, especially your note about cultural tourism and how travelers are seeking more unique experiences. We will continue to keep monitoring the industry to see the changes that transpire due to the credit crunch as well as other industry factors.
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