Hotel tariffs fall drastically - Travellers begin to get a break

By Harsha Pramod @ Monday, July 07, 2008 1:07 PM

Section - Business/Financials

The hospitality sector is groaning under a hike in fuel prices, airfare and freight rates leading to a decrease in occupancy and fall in tariff, reported the Economic Times.

According to the report, there has been a 25% to 30% decrease in room occupancy in the city hotels in Delhi. The report predicts a decrease of 10% to 25% in tariff in Delhi. An average room in Delhi, which was available for Rs18,000 ($415.8) to 22,000 ($508.2), has decreased to Rs10,000 ($231) to 12,000 ($227.2).

We investigated by calling Bangalore hotels. While hotels such as the Oberoi in Bangalore, which charge about Rs12,000, fall under this bracket, hotels such as Leela charge as much as Rs19,000 ($439) for a deluxe room, showing an increase in its rates. The Oberoi also offers an average room for around Rs10,000 without the frills.

In Delhi, the room tariffs are expected to fall by 30% this year. This may bring down the rates from Rs 12,000-15,000 to 6000-9000 this year. The availability of more rooms is also believed to affect the pricing.

The Amex 2008 Asia-Pacific corporate hotel rate projections and market forecast had predicted a steep rise of 36% in Delhi and 40% in Mumbai. However, the present trend may prove the report wrong. The report had also predicted that Bangalore would record a 225% increase in the demand for hotel rooms during 2006-08, while Delhi and Mumbai would record an increase of 44%and 30%, respectively. The study stated that the occupancy rates in Bangalore would remain steady at 70% in spite of the lack of good infrastructure. The report had predicted a considerable increase in occupancy. X

Check Out
Ehotelier.com: here