Hotels and airlines scramble for last-minute bookings for Paris Olympics
With just 1.5 million international visitors expected for the Games, the travel sector is feeling a pinch where it had hoped to see a boom
WHEN the Olympic Games kick off on Jul 26, expect to see mostly French spectators in the stands.
According to data from Paris je T’aime, the city’s tourism board, the capital is expecting 11.3 million visitors during the Olympic weeks, of which only 1.5 million will be from outside France.
While that’s enough to keep stadiums busy, hotels, airlines and travel agencies are feeling a pinch where they had hoped to see a boom.
Alan Bachand, the owner of sports travel firm 14sb, has built his business in the past on pre-buying blocks of hotel inventory for major events-the Super Bowl, Fifa World Cup, the Olympics and packaging it with tickets at competitive prices for superfans. But this year, he said that sales have fallen 80 per cent short of his expectations based on previous Olympic games.
“This is the first time in 25 years that we will accept less money than we paid for hotel rooms that we contracted 30 months ago,” he added.
Normally, Bachand said, his sales begin a year before the event. “But the prices were crazy high, we had to spend US$1,000 per night on hotels that would normally cost US$400 and if we pay a lot of money, we have to mark ‘em up and sell ‘em for a lot of money,” he explains.
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“Once everyone realised the phones were not ringing, around 100 days out, people started to cut prices in half, and we have had to do the same.”
At this point, Bachand hopes to break even, rather than lose money on the event. But he is not sure it will be possible.
Airlines are in similar predicaments. On Jul 11, Delta Air Lines estimated it would take US$100 million in losses as travellers opted to skip France during the Olympics, leaving too many unsold seats. In a similar situation is Air France, which expanded its flight capacity from US cities to Paris by 15 per cent during the Games.
Its parent company Air France-KLM has so far reported a revenue loss of at least 180 million euros (S$264 million) in July and August, which it attributes to the Olympics. With many of its added seats still unsold, it is also slashing prices – particularly for people booking with points, where the discounts are more opaque.
“Cities with non-stop flights to Paris such as New York, Chicago, Atlanta and LA still have jaw-dropping reward flight availability for late July and into August during the Paris Olympics,” said Gilbert Ott, a spokesperson for point.me, a reward travel search engine.
“In recent days, I have found flights on Air France from New York for 20,000 points one-way, Atlanta for 15,000 one-way, or even further afield such as Los Angeles for 30,000 one-way.” That’s as little as around US$200 worth, using the typical exchange rate of a penny per point.
The trend applies industry-wide. Whereas international flights to Rio de Janeiro grew by 115 per cent year-over-year during its Olympics period in 2016, Paris has only seen a growth of 8 per cent, according to data from travel analytics company ForwardKeys.
Bachand said travellers are not afraid to spend these days, but they saw the writing on the wall that prices were set too high. “People want to go, but they are also willing to hold out,” he said, adding that many travellers wanted to wait and see how geopolitical events and the French election played out to better assess safety concerns before making a decision.
But with so little time remaining before the opening ceremony on Jul 26, hotels are getting especially antsy. The scramble to boost occupancy by decreasing nightly rates and eliminating minimum stay requirements is being felt across almost all sectors of the city’s hotel industry, including both apartment rentals and luxury hotels.
And it also comes amid a year of record tourism in Europe, where international visitors driven by Americans are poised to contribute 800 billion euros to the region’s economy.
“To stay competitive with other Parisian hotels, we are forced to lower our prices because many properties initially set very high prices and have been continuously lowering them for months,” said Orso Hotels’ director of operations Gilles Le Bras.
The boutique group’s four-star rated Wallace, which offers rooms for around 410 euros per night, has been among its best performing, likely due to its proximity to a variety of Olympics sporting venues, he said. On Priceline, its rooms have been discounted further, recently selling for US$340 during the first week of the Games.
Another four-star hotel, Hotel Dame des Arts, located in the Latin Quarter, is offering a 15 per cent discount code for any stays between Jul 26 and Aug 11 and telling potential guests that they can redeem the promotion anytime before Aug 8 in hopes of converting the most last-minute trip planners.
All told, Paris hotel occupancy levels during the event are hovering around 80 per cent, according to CoStar data released on Jun 26. That’s markedly below hotel occupancy during London 2012 and Rio 2016, which shook out at an average of 88.6 per cent and 94.1 per cent, CoStar data shows.
Not everyone is cutting prices, and the winners on the hotel front are those who never charge exorbitant rates to begin with. Take Generator, which offers a mix of hostel and traditional hotel rooms: Its CEO Alastair Thomann said the gross rate for its cheapest category, a bed in a large dorm room, is currently around 76 euros per night, double the 38 euros that it charged this time last year. For private rooms, the gross rate is 205 euros, a 72 per cent mark-up on 2023.
With months of planning generally required to secure tickets to the most coveted events, such as track-and-field and swimming, a sudden influx of spontaneous tourists is unlikely to pile into the City of Lights to fill vacant rooms. And the families and friends of athletes who secured coveted berths on national teams-some as recently as the past month have, by now, made travel plans.
“We are not seeing a last-minute boom,” Orso’s Le Bras said.
Bachand has already chalked up the event as a “miss”, with business pivoting to next year’s Super Bowl. But he has not fully closed the door on Paris yet. “We will break even if we can sell just 100 more hotel rooms, and the last-minute deals are really good.”
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