When the Olympic Games begin on July 26, you will probably see mostly French spectators in the stands.
According to Paris je t’aime, the city’s tourism association, the capital expects Olympics weeks – of which only 1.5 million will be international.
Although this is enough to fill the stadiums to capacity, hotels, airlines and travel agencies are feeling the pinch where they had hoped for a boom.
Alan Bachand, owner of a sports travel company 14sbhas built his business in the past on buying up hotel blocks for major events – the Super Bowl, the FIFA World Cup, the Olympics – in advance and combining them with competitively priced tickets for superfans. But this year, he tells Bloomberg, sales have fallen 80 percent short of what he expected based on past Olympics.
“This is the first time in 25 years that we have accepted less money than we paid for the hotel rooms we booked 30 months ago,” he says.
Normally, he says, his sales start a year before the event. “But the prices were insanely high – we had to spend $1,000 a night on hotels that would normally cost $400 – and when we pay a lot of money, we have to raise the price and sell the hotels for a lot of money,” he explains. “When everyone realized the phones weren’t ringing, about 100 days before the event, people started cutting prices in half – and we had to do the same.”
Bachand is currently hoping that the event will not result in a loss, but will break even. But he is not sure whether that will be possible.
The airlines are in a similar situation. On July 11 Delta Airlines Inc. estimates that losses would be $100 million as travelers avoid France during the Olympics and too many seats remain unsold. In a similar situation is AirFrance, which has expanded its flight capacity from U.S. cities to Paris by 15 percent during the games. Parent company Air France-KLM has so far reported revenue losses of at least 180 million euros ($195.5 million) for July and August, which it attributes to the Olympics. With many of the extra seats still unsold, AirFrance is also cutting prices – especially for people booking with bonus points, where discounts are less transparent.
“Cities with nonstop flights to Paris such as New York, Chicago, Atlanta and LA still have amazing award flights available for late July and August during the Paris Olympics,” said Gilbert Ott, a spokesman for show mea search engine for award travel. “In the last few days, I’ve found Air France flights from New York for 20,000 points each way, from Atlanta for 15,000 points each way, or even from even more distant destinations like Los Angeles for 30,000 points each way.” That’s a value of just about $200 using the usual exchange rate of one cent per point.
The trend is evident across the industry. While international flights to Rio de Janeiro increased 115 percent during the 2016 Olympics compared to the previous year, Paris only saw 8 percent growth, according to data from travel analytics firm ForwardKeys.
Bachand says travelers aren’t afraid to spend money lately, but they’ve seen the writing on the wall that prices are too high. “People want to go, but they’re also willing to wait,” he says, adding that many travelers want to wait and see how geopolitical events and the French election unfold to better assess security concerns before making a decision.
But so close to the opening ceremony on July 26, hotels are becoming increasingly nervous. The scramble to increase occupancy by reducing overnight prices and abolishing the minimum length of stay is felt in almost all sectors of the city’s hotel industry, including both apartment rental And Luxury hotels.
And it also comes in the middle of a year of record Tourism in Europe, where international visitors – especially Americans – are expected to contribute €800 billion to the region’s economy.
“In order to remain competitive with other Parisian hotels, we are forced to lower our prices, as many hotels initially set very high prices and have been continuously reducing them for months,” says Gilles Le Bras, Operations Manager of Orso Hotels.
The four-star boutique group Wallacewhich offers rooms for around 410 euros ($446) a night, is one of the top-selling hotels, probably due to its proximity to several Olympic venues, he said. Rooms have been offered even cheaper on Priceline, most recently for $340 during the first week of the games.
Another four-star hotel, the Hôtel Dame des Arts in the Latin Quarter, is offering a 15% discount code for all stays between July 26 and August 11 – and telling potential guests they can redeem the promotion any time before August 8, in the hope of swaying even the most last-minute travel planners to make a purchase.
Overall, Paris hotel occupancy during the event is around 80 percent, according to CoStar data released on June 26. This is significantly lower than hotel occupancy during London 2012 and Rio 2016, which averaged 88.6 percent and 94.1 percent, respectively, according to CoStar data.
Not everyone is cutting their prices – and the winners in the hotel sector are those that don’t charge exorbitant prices in the first place. One example is Generator, which offers a mix of hostel and traditional hotel rooms: according to its CEO Alastair Thomann, the gross price for the cheapest category, a bed in a large dormitory, is currently around 76 euros per night, double the 38 euros charged this time last year. For private rooms, the gross price is 205 euros, a 72 percent increase over 2023.
Because it usually takes months of planning to get tickets to the most coveted events, such as track and field and swimming, it’s unlikely that a sudden influx of spontaneous tourists will flock to the City of Lights to fill the empty rooms. And the families and friends of the athletes who secured coveted spots on the national teams – some just in the last month – have since made travel plans.
“We are not experiencing a last-minute boom,” says Le Bras of Orso.
Bachand has already labeled the event a “failure” as he now focuses on next year’s Super Bowl. But he hasn’t written off Paris completely. “We’ll break even if we can sell just 100 more hotel rooms, and the last-minute deals are really good.”