Fall in exchange rate will force hotels here into 10% price cut to lure British tourists

HOTELS will be forced to drop their prices by about 10% next year in a bid to lure British tourists to Ireland.

Visitors from Britain account for about 50% of tourism into Ireland and they dominate the weekend break market, according to Davy analyst, Rossa White. “Their purchasing power is being hit,” he said, adding that sterling is likely to keep declining.

Chief executive of the Irish Hotels Federation, John Power said the situation is certainly something hotels are worried about.

He said the sharp drop in sterling against the euro from about £67 to £95 (for €100) in the past 12 months will make the job much more difficult for Irish hotels.

“It isn’t welcome and hotels will need to work harder for what’s there.

“Prices have fallen in Ireland over the past year and next year will certainly be more challenging,” he said.

Mr Power said hotels will likely be forced to drop their prices by about 10% next year.

There are now 60,000 hotel rooms in Ireland, up from 40,000 two years ago.

“We are facing a situation that we are not used to and this will present a challenge,” he said.

Also Fáilte Ireland said it is “very concerned” about the situation.

“The UK is our largest market for foreign visitors and it is also our nearest neighbour when it comes to attracting tourists.

“The tourism industry is certainly feeling the cold wind of the recession,” a spokesman said.

He added that despite a good, positive start to the year the tourism sector in Ireland has suffered in the second half.

“It really has started to feel the pinch,” he said.