1 / 39

The financial / economic crisis and the hospitality industry

The financial / economic crisis and the hospitality industry. b y Ákos Niklai Member of the HOTREC Executive Committee. Contents. Brief introduction to HOTREC The crisis and the hospitality industry Some data Recovery at EU level Recovery at national level Conclusions.

avon
Download Presentation

The financial / economic crisis and the hospitality industry

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. The financial / economic crisis and the hospitality industry by Ákos Niklai Member of the HOTREC Executive Committee Prague, 10 June 2009

  2. Contents • Brief introduction to HOTREC • The crisis and the hospitality industry • Some data • Recovery at EU level • Recovery at national level • Conclusions Prague, 10June 2009 2

  3. Represents hospitality industry at European level 40 National Associations in 25 European countries I. Brief introduction to HOTREC Prague, 10June 2009 3

  4. European hospitality sector 1.6 million enterprises 9 million persons employed automotive production + sales + servicing: 6.3 million agriculture: 10 million 163 billion EUR value added chemical sector 170 billion EUR I. Brief introduction to HOTREC(cont’d) Prague, 10June 2009 4

  5. European hospitality sector 99% of enterprises employ < 50 people these 99% make up 62% of value added 92% of enterprises employ < 10 people I. Brief introduction to HOTREC(cont’d) Prague, 10June 2009 5

  6. II. The crisis and the hospitality industry In a nutshell: Crisis combined with confidence Direct impact on industry • business travels • business events (congress, seminars...) • private trips/outings • search for cheaper prices • cost of credit 6

  7. III. Some data European economy (EUROSTAT) GDP: 1st quarter ‘09 compared to 4th quarter ‘08 to 1st quarter ‘09 in EU 27 by 2,5% by 4,4% in Euro area by 2,5% by 4,6% Unemployment (March ’08 – March ’09) in EU27 from 6,7% to 8,3% in Euro area from 7,2% to 8,9% Prague, 10June 2009 7

  8. III. Some data (cont’d) Confidence in the European economy (European Commission) Economic Sentiment Indicator (ESI) (Feb ’09 - April ’09) ESI by 0,6 points in EU27 (at 60,3 pts in March) by 3,5 points in EU27 (at 63,9 pts in April) (long term average =100 points) Indicator increasing for the first time over 2 years Prague, 10June 2009 8

  9. III. Some data (cont’d) UNWTO World Tourism Barometer International tourist arrivalsWorldEurope On average between 2004 and 2007 +7% < 5,0% January to June 2008 +5,7% +3,4% June to December 2008 -1,7% -2,8% In 2008 (thanks to 6 first months!) +1,7% +0,0% Europe with worst performance in 2008! Prague, 10June 2009 9

  10. III. Some data (cont’d) UNWTO World Tourism Barometer International tourist arrivalsWorldEurope On average between 2004 and 2007 +7% < 5,0% January 2008 – January 2009 -6,6% -5,4% February 2008 – February 2009-8,8% -11,2% Prague, 10June 2009 10

  11. III. Some data (cont’d) UNWTO World Tourism Barometer Prospects for 2009(as of January 2009 – still maintained) for the worldfor Europe • stagnation stagnation • or slight decline (-1% to -2%)or -3% Prague, 10June 2009 11

  12. III. Some data (cont’d) Hotel performance in EU (2008) • Occupancy: 69,3% (2007) down to 66,9% (2008) - most affected: Prague, Rome, Dublin (~ -9,5%) - no European capital in + • Average room rate: stagnation • RevPAR: -4,2% Prague, 10June 2009 12

  13. III. Some data (cont’d) European Travel Commission Hotel performance in EU January – February 2009 (vs. same period 2008) Occupancy 10% Average daily rate 10% RevPAR 20% Prague, 10June 2009 13

  14. III. Some data (cont’d) Hotel performance in EU April 2008 – April 2009 Occupancy rate 68,9% 59,4% Average daily rate 15% RevPAR 27% Prague, 10June 2009 14

  15. III. Some data (cont’d) Reports by some associations Budapest first 3 months in 2009 (vs. same period 2008) Room nights 20% Revenue 30% RevPAR (5* ) 40% Restaurant revenue 40% Prague, 10June 2009 15

  16. III. Some data (cont’d) Reports by some associations Prague first 3 months in 2009 (vs. same period 2008) Room occupancy 18% ( at 39%) RevPAR 20-30% Situation of restaurants: 30% to close down in ’09-’10 Prague, 10June 2009 16

  17. III. Some data (cont’d) Reports by some associations France - hotels: (Jan ’08 – Jan ’09) Occupancy 3,3% Restaurants: Turnover 20-50% (depending on region) Prague, 10June 2009 17

  18. III. Some data (cont’d) Reports by some associations Spain hotels Occupancy 15% RevPAR 20% Prague, 10June 2009 18

  19. III. Some data (cont’d) Reports by some associations Spain restaurants Employment 60.000 jobs lost over12 months Rev. (Jan’08 – Jan’09) 5,2% Rev. (Feb’08 – Feb’09) 9,7% Prague, 10June 2009 19

  20. III. Some data (cont’d) Reports by some associations Portugal Rev. (Jan, Feb ’08 – Jan, Feb ’09) 5,2% Nights (Jan, Feb’08 – Jan, Feb’09) 9,7% Prediction for 2009: 10-20% Prague, 10June 2009 20

  21. III. Some data (cont’d) Reports by some associations Ireland Occupancy 2007 2009 (forecast) 64% 54% Prague, 10June 2009 21

  22. III. Some data (cont’d) EUROBAROMETER survey (20 March 2009) On holiday plans of consumers • 27 000 consumers interviewed • in February 2009 • in the 27 EU countries Prague, 10June 2009 22

  23. III. Some data (cont’d) EUROBAROMETER survey On holiday plans of consumers • Main results: • Impact of changes in cost of living on holiday plans • 1/3 some impact on holiday plans (out of which for 38% this meaning not to take holidays at all) • 1/3 no impact • 1/4 no change in cost of living (the rest: no answer) • Where to save? • 15% would save on accommodation - 23% would go rather in low season • 23% would save on restaurant spending (30% on shopping) 23 Prague, 10June 2009

  24. IV. Getting out of the crisis How soon ? 3 possible scenarios VorUorL Prague, 10June 2009 24

  25. IV. Recovery at EU level “Yes, Europe has the unity, the confidence and determination to win this battle” Commission President José Manuel Barroso Prague, 10June 2009 25

  26. IV. Recovery at EU level(cont’d) • Succession of meetings of EU heads of State or government since October • 3 main lines of actions: • promoting financial stability in order to re-buildconfidence • getting the real economy back on track • staying united against the crisis and working together at global level • 2 levels: • EU • national 26

  27. IV. Recovery at EU level(cont’d) Example of general measure • European Investment Bank € 30 bn available for loans to SMEs via commercial banks at favourable interest rates Prague, 10June 2009 27

  28. IV. Recovery at EU level(cont’d) Example of measure specific for the hospitality industry • Change in VAT rate system – came into effect on 1 June 2009! All Member States are allowed to applya reduced VAT rate to restaurant services (before only 11 of them were allowed to do so) Prague, 10June 2009 28

  29. V. Recovery at national level Responses to crisis vary greatly! Prague, 10June 2009 29

  30. V. Recovery at national level VAT – good examples • from 17,5 to 15% in general (UK) • from 19% to 9% on restaurant services (CZ)? • from 19,6 to 5,5% on restaurant services (FR)? • from 21% to 6% on restaurant services (BE)? Prague, 10June 2009 30

  31. V. Recovery at national level VAT – bad examples • from 5% to 9% on hotels (Estonia) • from 5% to 19% on hotels (Lithuania) • from 5% to 21% on hotels (Latvia) • from 20% to 25% on hotels and restaurants (Hungary) Prague, 10June 2009 31

  32. V. Recovery at national level VAT rates for hotels on 1 January 2008 Prague, 10June 2009 32

  33. V. Recovery at national level VAT rates for hotels on 1 July 2009? Prague, 10June 2009 33

  34. V. Recovery at national level VAT rates for restaurants on 1 January 2008 Prague, 10June 2009 34

  35. V. Recovery at national level VAT rates for restaurants on 1 July 2009? Prague, 10June 2009 35

  36. V. Recovery at national level Other measures • Increase in budget for marketing (e.g. Prague, Austria, Greece) • Subsidised credit for the industry (e.g. Austria, Portugal, Spain) • Abolishment of the bed-tax, special support for seasonal hotel enterprises, reduction of the landing fees (Greece) Prague, 10June 2009 36

  37. VI. Conclusions Overall objective of the industry EU and 27 Member States are to create the conditions for • economy to recover • growth to florish • employment to redeploy Survivalof the 1.6 million enterprises as well as the future of 9 million employees are at stake Prague, 10June 2009 37

  38. VI. Conclusions (cont’d) • New European Parliament • New European Commission • Strengthened recovery plan? Need of: • further facilitation of credit for businesses • reduction of charges to businesses • creative solutions for keeping/increasing skills Prague, 10June 2009 38

  39. Thank you for your kind attention! www.hotrec.eu 39

More Related