Europe’s Top Hotel Says Glut To Thwart Revival: Corporate India
Occupancy rate at luxury hotels fell to 59.9 percent in the year through March 2012 from 73.8 percent in 2006, according to data provided by the Federation of Hotel and Restaurant Associations of India . Slowing economic growth hasnt discouraged the operators from betting on Indias potential. Accor, which has started a three-year reorganization plan that includes increasing its focus on emerging markets, is betting on Indias middle class, which is forecast to add the equivalent of more than the entire population of Germany in less than a decade. Middle Class Between 2010 and 2021, Indias emerging middle class — who earn as much as $5,550 a year — will swell by 100 million to 570 million, PricewaterhouseCoopers estimated in June 2012. Paris-based Accor , which has 23 percent of its hotels in Asia, considers India as one of its three strongest growing markets over the longer term after China and Indonesia , Issenberg said. More than half the hotels it will build will be in Asia, he said. Hotels are a consumer item, its a discretionary spend, Issenberg said. As the middle class continues to grow in Asia, travel will continue to grow and grow faster than GDP. Nakul Anand, chief executive of ITCs hospitality business, said in July that the operator is developing at least 18 projects. Indian Hotels opened two new hotels since April, adding 175 rooms, according to an Aug. 12 company presentation. It plans to add 1,575 rooms by March 2014 and an additional 1,553 in the next fiscal year, it said at the time. Keeping Up India has 200,000 rooms versus 5 million in the U.S., which has a smaller population, and 3 million in China, according to Indian Hotels Managing Director Raymond Bickson. Accor has over 455,985 rooms at more than 3,555 hotels in 92 countries, according to its website. Its brands include Sofitel, Pullman, MGallery, Grand Mercure, the Novotel, and Ibis.
Europe’s Car Sales Rally, Thanks To Discounts, Dealer Action
The rally is based on expensive price cutting and manipulated sales data, which will only further undermine the precarious state of most of Europes non-German manufacturers. Car sales may have stopped falling at close to 20 year lows, and forecasts for next year are positive. But much of this improvement has been down to huge spending by the manufacturers on discounts and price cuts, while dealers are being persuaded to buy the excess cars on their lots which count as new car sales. These will eventually be sold on to the public at well below sticker price. The Brussels-based European Car Manufacturers Association, known by its acronym in French, ACEA, ( www.acea.be ) announced today that Western European car sales were up 5.4 per cent in September compared with the same month last year at just over 1.1 million, bringing the total for the year so far to 8.8 million. Thats a fall of 4.0 per cent on the first nine months of last year. Peter Fuss, partner at consultants Ernst & Young Ernst & Young s Global Automotive Center in Frankfurt, Germany, said the recovery in car sales was down to the improvement in Europes economic outlook, with the Euro currency zone pulling out of recession during the second half of 2013. But with factory use down to less than 65 per cent by manufacturers, according to Fuss, this underlines the chronic overcapacity in Europe, which remains unresolved because of pressure from unions and governments to resist rationalisation. The European industry is looking for a bailout along the lines of the U.S. intervention on behalf of bankrupt GM and Chrysler, to allow it to finally shut-down uneconomic factories. But given the financial crisis in the euro zone, this is simply unaffordable. Ernst & Young expects an overall decline of three per cent in Western Europe for the whole year, and only modest growth next year. This growth will continue to be artificial one that is driven by discounts and self-registrations.