Escalating hotel rates, see-sawing between Europe and the United States, are driving more tourists to luxury cruising, according to travel experts at Signature Travel Network.
Speaking with media earlier this month at the consortia’s annual Conference in Las Vegas, senior executives flagged abhorrent hotel ADRs (average daily rate) that have arisen in major tourist cities during and since the pandemic.
Ignacio Maza, Executive Vice President at Signature Travel Network said that in 2023, Europe experienced “incredibly strong” hotel demand, which affected demand in North America. He and Alex Sharpre, President of Signature, were in agreeance that ADRs had “gone up way too high”.
Maza said that his feedback from partners in destinations such as Los Cabos in Mexico and other parts of North America indicated their clients went to Europe this year instead. “They did not go to the traditional destinations that they went to, so they experienced a slow down in demand.”
He continued, saying that during the pandemic “North America experienced a phenomenal boom, to the detriment of Europe. And then when Europe reopened, Europe boomed to the detriment of North America.”
Maza said he feels the situation is likely to level out, but noted some North Americans will be apprehensive about going to the eastern Mediterranean or other European destinations and believes they may feel more comfortable staying at home.
The excessively high ADRs have also been a catalyst for travellers to turn to cruising, Maza said.
“This is also why you’re seeing such a boom on the cruise side of things. Especially at the luxury end when everything is all-inclusive. Crystal is all-inclusive, Seabourn is all-inclusive, Regent [Seven Seas Cruises] is all-inclusive, Silversea is all-inclusive.
“So when you’re looking at a seven-, eight- or nine-hundred dollar ADR with all your meals, your excursions, your entertainment, your home, and travel and the whole bit, staying in a hotel at 15-, 16-hundred dollars a night, without meals, without entertainment, without all the other stuff… it’s quite a shock to see the difference,” Maza concluded.