A recent research indicates that in the past year, European Hotel prices have risen by 50% on average; making it unaffordable for Britons. This is attributed to weakening of the pound which has dropped by 13% against the euro (€1.27 to €1.12, since May 2008. However, a monthly hotel price index by Trivago, an online assessment website shows that the rates for British holidaymakers have escalated far beyond the currency fluctuations.
On average hotel prices for this month, compared to may last year, in Venice, Geneva, and Nice have increased by £60, £54 and £47 respectively. In general, a night in a double room in any of the top 50 Europe cities costs an average of £107 now, 15% more than May 2008.
Spanish and Greek cities have also shown slight increases in their hotel rates. This is because hoteliers in the two cities heeded calls from tour operators to lower hotel prices amidst the recession. Valencia cut its rate by £3, Seville cut its rate by £51 while Madrid rates were unchanged.
As a result, the numbers of British holidaymakers to Europe have considerably reduced this year as compared to last year. Eurostar reported that the passenger numbers declined by 11.5% between January and March compared to the same period last year. This week, EasyJet, which is the most preferred carrier announced a pre-tax loss of £117 million.
Statistics released by Price Water House Coopers this week indicate that in the past 12 months, 78 travel companies were unsuccessful, compared to 49 in the previous year. Ian Oakley-Smith, an executive at PWC projects that the full impact of the economic downturn will be felt in autumn after the summer peak.
The Post Office announced that the Kenyan Shilling, The Jamaican Dollar, the Indonesian rupiah and the East Caribbean dollar are the few foreign currencies whose demand is growing rapidly.