Summer sees French hotels on a slow downtrend

While the first semester 2004 came to a close with a growth recovery for the RevPAR, the summer season marks a veritable void in the trend with two consecutive months of decline on the year 2003. The mid and upscale categories in particular, which had positioned their growth strategies for the RevPAR so as to reconquer market shares and improve occupancy rates, sees their occupancy levels for this summer lower than the preceding one. In August, the difference is by more than 3 points on both the 3* and the 4* segments. Economy categories come out a bit better, but only the 0* segment is able to grow its occupancy rate. In all, the average occupancy rate of hotel properties in France is down by 1.7 points. At the same time, average daily rates remain very stable from one year to the next (+0.4%). In particular, we are seeing a drop in average daily rates on the 3* segment which is seeing some of its clientele conjured away by the more reasonable rates at two-star hotels, or by more upscale properties that allow more attractive rates during slumps in demand. Francine Riou, General manager of the tourist office in Arles, admits: “In July, two-star properties benefited from a shift from the three star category linked to a drop in customer buying power – particularly that of Americans whose budget has been restricted this year”. Also, the revenue per available room across all categories is down by 2.1% on the previous year, which result is just a continuation of the slump observed in July (-1.1%). This summer will thus have been fairly disappointing for tourism professionals who were waiting impatiently for this period after a disastrous year 2003 and a good beginning of the year 2004. Everyone agrees that European tourists...