For whatever reason, the airline industry’s woes have gotten lots and lots of media attention, but when it comes to facing down a gigantic mess, the hotel industry has it far worse right now. How bad? Hotel occupancy for the first week in November dropped more than 14 points versus last year to a very, very bad 56.9%. We’re talking post-9/11 bad. Other stats? Revenue per available room (so-called RevPAR) in the luxury segment is down 23% year over year during the first week in November. Average daily rates (ADRs) in Vegas were down 21% in September versus last year.
With travelers typically booking 45 or so days out, hotels are just now feeling the effects of September’s terrible financial news. Unlike airlines, hotels can’t easily take capacity out of the market (short of shutting down hotels entirely, a move that some chains are taking with their lesser-performing hotels, or taking this opportunity to renovate).
On the plus side, travelers will be happy with the cheaper hotel rates and, especially in the upper and luxury segments, packages with extras that are available during the coming months.