66% of hotel bed nights sold to Irish guests this year

IRISH guests account for two out of three bed nights sold in hotels as demand from overseas visitors falls due to the recession.

According to a report from the Irish Tourist Industry Confederation (ITIC), the domestic market now accounts for a 38% share of holiday bed nights in the country, and almost two out of three hotel bed nights, generating almost one-third of Ireland’s total income from tourism.

The recession has led to a sharp decline in the demand for domestic holidays by Irish people which is unlikely to be reversed until 2012, the report states.

However, despite the pessimistic outlook, demand for home holidays is “holding up better than demand for holiday trips abroad”.

Such demand is “vital” for the recovery of the tourism sector here, the research found.

ITIC chairman Tom Haughey said the importance of the domestic market to Irish tourism could not be overstated.

“It underpins the overseas visitor market, sustains most tourism businesses on a year-round basis and, most critically of all, supports employment in the sector.”

Between 2004 and 2008, domestic holiday nights increased at a faster rate than holiday nights from overseas visitors, growing by 7% each year compared to 5% from abroad.

Domestic market demand now accounts for more than 90% of new business for Irish hotels.

However, with the economic downturn, this year saw a 10% drop in the number of home holiday trips and a 15% decline in spending over the first half of 2009.

Despite this, demand for home holidays seems to holding firmer than demand for foreign trips, which have fallen by almost 20% in volume and 21% in value in the first six months of this year.

The report highlighted a number of possible scenarios for the performance of the domestic market over the next three years but favoured a “battered but resilient outcome”.

This would see a 10% drop in volume this year followed by a further decline of 10% in 2010 with the market stabilising in 2011, before returning to modest growth of 5% in 2012. This would suggest volume in 2012 to be close to 2006 levels.

The ITIC pointed out that such a recovery in the home market was dependent on a restoration of the public finances, competitiveness and consumer confidence through appropriate Government policies.