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Business tourism plunges on US, Europe recession

Hotels are cagey on sharing information, but several officials confirmed on condition of anonymity that the fall in business arrivals this season could be anything between 40 and 60 per cent. Lalatendu Mishra reports.

business Updated: Mar 16, 2009 23:07 IST
Lalatendu Mishra

There has been a steep fall in inbound business tourism as recession-hit Western companies slash executive travel.

Hotels are cagey on sharing information, but several officials confirmed on condition of anonymity that the fall in business arrivals this season could be anything between 40 and 60 per cent.

“We don’t deny that foreign tourist arrivals have dropped. We have seen a decline of 12 to 13 per cent in business (foreign) travel. So we have corrected the prices by 15 per cent in Mumbai and Bangalore,” said Sanjay Pasricha, vice president (sales & marketing), the Leela group of hotels.

“Travel from USA and Europe has slowed down, though we have started to see some recovery. The booking windows have shortened and obviously there is less corporate travel,” said Guy Godet, general manager, JW Marriott, Mumbai.

Analysts tracking the hospitality sector said that the average room occupancy rates of hotels in Mumbai and Delhi have come down from 70 per cent to 55 per cent now.

Hotel groups are seeking new markets to drive demand.

The Leela group is aggressively promoting its properties in countries Russia, Spain, London, Germany, Japan and Singapore.

“We have stepped up out sales and marketing initiatives in these markets. We have joined the government to attract tourists and we expect positive results in three months,” said Pasricha.

“We are also exploring new markets such as the Middle East, South and Eastern Africa, said Marriott’s Godet.