Business sentiment amongst Galway hotels and guesthouses has deteriorated sharply year on year, representing a stark change in outlook over the past twelve months.
That’s according to the Irish Hotels Federation – and it’s a phenomenon repeated across the country, according to an industry survey released ahead of its annual conference in Killarney.
The survey reveals that only 40% of hoteliers nationally now have a positive outlook for their business over the next twelve months – compared with 79% at the start of 2018.
Major concerns for the sector include the continued risk of a disruptive Brexit and reduced competitiveness due to the hike in tourism VAT, increases in the cost of doing business and growing economic uncertainty internationally.
In particular, the higher VAT rate is putting investment in additional hotel capacity at risk, with 75% of hoteliers stating they are now reassessing plans to increase capital investment as a result of the increase.
Performance so far this year has been mixed, with 39% of hoteliers across the country reporting a drop in overall business levels compared to this time last year while 48% report an increase. This has largely been driven by growth from North America and Europe, which is masking continued poor performance of the UK market.
Almost two thirds of hoteliers (65%) say advance bookings for 2019 from the Great Britain are down while almost six in ten (57%) are seeing a fall in advance bookings from Northern Ireland.
With the vast majority of hoteliers (91%) concerned about the impact of Brexit, IHF Galway branch chairman Nigel Canavan warned that growth in recent years cannot be taken for granted.
For more, read this week’s Connacht Tribune.
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