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April 2024: The European hotel industry is making slow but steady progress

Progress in the European hotel sector slowed somewhat in April, a month still marked by inflation and a difficult geopolitical context. Southern Europe continues to be the driving force behind this growth, alongside a growing number of Northern and Central European countries such as Germany, Switzerland and the Czech Republic.

In April 2024, the European hotel industry recorded an occupancy rate of 69.3%, a slight drop of -0.2 points compared to 2023, but a significant increase of +6.2 points compared to 2022. Although occupancy levels are slightly below last year’s levels, the indicator nevertheless shows an increase of +2.9 points compared to the previous month.

The average daily rate continues to climb month on month, rising from 116.8 euros in March to 122.1 euros this month. This increase can also be seen in comparison with April 2023 (+0.7%) and especially April 2022 (+18.3%). Faced with an economic climate that is still impacting hoteliers’ operating costs, the pricing power strategy is still the right one.

The slight fall in the occupancy rate has been made up for by the rise in the average daily rate, enabling the European hotel industry to post a 0.4% increase in RevPAR. Unsurprisingly, the gap with April 2022 is even more striking, with RevPAR jumping by +29.9%.

The upscale segment is once again doing well, being the only one to see its occupancy rate rise (+1.3 points), while the budget segment saw its occupancy rate fall by -4.2 points. Occupancy levels in the economy and midscale segments are like those seen in April 2023.

The budget segment is also the only one not to have fully returned to its 2022 occupancy level (-0.1 points), while the upscale category shows the strongest growth (+8.6 points).

In terms of prices, only the entry-level segments showed a slight decline (-0.3% for budget and -0.9% for economy), as they do not benefit from great price elasticity, unlike the midscale and upscale segments, which posted increases of +0.8% and +1.7% respectively. Nevertheless, all categories will see double-digit increases in their average daily rates compared with 2022.

Unsurprisingly, the budget segment shows the biggest decline in RevPAR (-6.4%), followed by the economy segment (-0.9%), while the midscale segment shows a timid improvement of +0.7%. The upscale category stood out, with RevPAR up by 3.7%. Once again, all segments posted double-digit increases compared with April 2022.

After three months at the top of the rankings in terms of visitor numbers, the United Kingdom was dethroned by the Netherlands in April, with an occupancy rate of 80.8%. A gain of almost 10 points in the space of a month, partly due to the celebration of King’s Day in the country on 27 April, an event that attracts up to 1 million visitors to the streets of Amsterdam every year. This puts the Netherlands ahead of southern European countries such as Italy (77%) and Spain (75.6%), which are also on the podium.

Conversely, Greece (+11.4 points), Latvia (+5 points), Switzerland (+3.8 points) and Germany (+3 points) recorded the strongest growth in occupancy rates in April. Greece’s popularity in the off-season is thus confirmed, as is the emergence of new top tourist destinations in Northern and Central Europe.

Few countries have seen their average daily rates fall, with the exception of Italy (-12.5%), Latvia (-4.6%), Poland (-2%), the UK (-1.3%), the Netherlands (-0.2%) and Portugal (-0.1%). This downward trend affects both southern and northern Europe, with Italy recording by far the biggest decline.

The upward trend seen in the European hotel industry in recent months seems to have run out of steam in April. Visitor numbers were down in many destinations, despite the pricing power strategy being maintained across the board. The capricious weather, inflation and the geopolitical context seem to be affecting hotel activity on the Old Continent at the start of spring. It remains to be seen whether May will bring sunnier weather to boost tourism in Europe.


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