Spain’s hotel industry could eventually take a hit from a loss in British travelers in the wake of Brexit, but leaders of the country’s hotel and tourism association don’t expect an immediate negative impact from the U.K.’s vote to leave the EU.
MADRID—Spanish hoteliers said they have yet to see any immediate negative impact on tourism from the U.K. since that country voted to leave the European Union.
“Spain has long been, and should remain for the foreseeable future, the favored vacation destination for British visitors despite Brexit, and all indications are that bookings well into next year are still healthy,” said Juan Molas, president of the Spanish Confederation of Hotels and Tourist Accommodations, during a 28 July news conference.
The U.K. is Spain’s largest source market for foreign visitors. Last year, 68 million foreign visitors traveled to Spain, which was an increase of 5% over the previous year. Approximately 16 million Britons accounted for 21% of those visitors.
Following the victory for the “leave” vote in the 23 June Brexit referendum and the resulting drop in the value of the pound against the euro, there was concern in the Spanish hotel sector that the subsequent higher prices would keep Britons away.
But hoteliers noted that British travelers traditionally reserve their holidays months in advance, so there appears to be no immediate negative impact on peak business this summer.
Molas said that momentum should extend into the 2016-2017 winter season and next summer. He added that Spain’s tour operators and travel agencies that sell package vacations—which are used by 70% of British tourists when booking their Spanish holidays—have noticed steady booking trends well into 2017.
“Spain continues to be the most popular vacation spot for the British, who don’t tend to travel for leisure to some of our competitors like Egypt or Turkey, which are more popular among the Germans and French,” he said. “Spanish hotels and destinations offer the British what they want on a holiday: safety and good value for money. We’ve seen the pound-euro exchange rate fluctuate often in the past, and there was no lasting major effect on us.”
But Molas cautioned the weaker pound could curtail daily spending by British visitors in Spain and London will now be a cheaper alternative for event booking than Spanish cities.
“London is our biggest competitor in Europe for the convention trade, and Paris, where hotel prices have fallen because of the recent unfortunate events in France, is also a rival,” he said. “But our biggest competitor in all of this would be for the British to decide not to travel and just stay home.”
Long-term effects of Brexit are still unknown, said CEHAT Secretary General Ramón Estalella.
“We don’t have a crystal ball to see into the future, but there are three important unknowns to consider,” he said. “One is when Britain will finally leave the EU and what further effects that might have. Two, no one knows where the pound will be in value (in) six months or there could be a crisis in Europe dragging down the value of the euro and so making the pound stronger. And three, what might happen in our competitor countries that could affect the British source market.”
The CEHAT executives also presented the findings of a survey of its members—which include 54 local and regional hotel associations and 1.5 million beds—on the sector’s performance through the end of the summer. A majority of the respondents are looking forward to a positive high season thanks largely to a rise in room rates and longer average stays by guests, which will result in higher profits.
Molas said hoteliers are confident that the continuing demand from both Spanish and foreign guests will increase.
“What’s important now is to use the occupancy rates to maximize earnings and promote Spain through advertising and marketing so we can cement its position as one of the leading tourism destinations in the world,” Molas said.