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European hotel industry headed for a fall in 2013

Excerpt from Hotel News Resource

Mar 12, 2013 4:22 am

Skift Take

This is the summer for Southern Europe to figure out how it can get prices to the point where people will be happy to put up with minor inconveniences because they’re saving a few Euros.

— Jason Clampet

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RevPAR of the European Union collectively displayed a decrease of 1.2%. Growth engine for indicators in 2012, the upscale segment came to its maximum strength and starts to weaken. The downward trend in average prices is appearing in many markets: Netherlands as well as the UK are seeing reductions in the two indicators. Another European heavyweight France is still holding in terms of average prices, but the margin of maneuver becomes weaker and weaker. While Denmark is resistant thanks to business activity in its capital, Copenhagen, Sweden is facing a sharp drop in attendance.

Southern Europe is sinking deeper into the gloom. If Portugal falls greatly, it focuses on small volumes in its upscale hotels, less frequented in winter. Spain and Italy have very low levels of activity below 48% of OR which is addressed by aggressive pricing policies.

Germany alone continues riding on the success of its business events and of the continuous improvements on average rates.

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