Save BIG. Mint+The Economist at ₹3999Claim Now!

Business News/ Companies / News/ Goa tourism may not be impacted this winter, despite high hotel room rates, expensive cabs

Goa tourism may not be impacted this winter, despite high hotel room rates, expensive cabs

4 min read 13 Dec 2024, 02:16 PM IST

Varuni Khosla

As Goa navigates high room rates and transport challenges, hotel bookings for winter are steady but not growing significantly. South Goa shows promise with higher occupancy, while north Goa stagnates.

Considering that the flight and travel time from New Delhi to Goa typically takes about three hours, with additional time on the road to get to the hotel, travellers feel they can get to Thailand or Vietnam in the same timeframe

Gift this article

As Goa grapples with a public relations crisis, with users on social media ranting against high room rates and the lack of traveller-friendly transport facilities, it may only be a business-as-usual scenario for many hotels and travel companies this winter and no exponential growth, as was the case last year.

Additionally, there is stiff competition from easy and quick-visa overseas destinations such as Thailand and Vietnam that are only a short flight away, prompting many domestic travellers to skip Goa this time. However, hoteliers are still in wait-and-watch mode and optimistic of more bookings coming in as Christmas and New Year’s Eve draw closer.

For the Radisson Hotel Group, business in north Goa had been static in October and November, with growth at just about the same level as last year. What’s encouraging, though, is that there hasn’t been a drop in business. On the other hand, there has been an upswing in both average daily rates and occupancy in south Goa, where travellers pay much more per night.

"Weddings being held in south Goa in December have helped the business grow here and this part of the state has shown much more promise as compared to last year. It is about 8-10% more. Some international charters are also coming back, despite north Goa continuing to be in status quo with a small growth of 2-3% compared to last year," Nikhil Sharma, managing director and area senior vice president at Radisson, toldMint.

At north Goa's Ronil-JDV by Hyatt, which is in its first year of business, enquiries are coming in swiftly and it expects serious travellers to close their bookings in the coming week. Most groups and independent guests are in their mid-30s and 40s.

‘Hotel shopping’

"While travellers are still 'hotel shopping', we do expect them to finalise bookings soon. We are seeing a lot of repeat guests, which are groups of friends who visited earlier in the year, booking for the New Year dates," said Pratiti Rajpal, general manager of the hotel. “The pace looks promising for both Christmas and New Year… the travellers that are coming in are well travelled and want to enjoy the property experiences and spend a significant amount of time at the hotel and not just to go out. Many of these travellers come at least once a year and it's a must-do for them."

Goa attracted 10 million travellers in the March-December period last year, 30% higher than the pre-pandemic levels of 8.1 million tourists in 2019, Mint reported in December 2023. Arrivals totaled 2.3 million in October-December 2023, while arrivals for October 2024 reached 800,000, the state department of tourism said in an email to Mint. Data for the remaining period of the quarter is yet to be collated.

Some overseas destinations are adopting more strategic approaches, successfully attracting a growing number of travelers by offering affordable and accessible visa options, lower hotel rates, and enhanced flight connectivity. Considering that the flight and travel time from New Delhi to Goa typically takes about three hours, with additional time on the road to get to the hotel, travellers feel they can get to Thailand or Vietnam in the same timeframe.

"We don't see a decline in bookings in any of our hotels, but we also don't see growth as compared to last year," said Jatin Khanna, CEO of Sarovar Hotels and Resorts. “A couple of the hotels have shown flat growth, while a couple are growing. We do expect two of our hotels to grow in double-digits over last year, but majorly on rates, and not necessarily on occupancy. When you're at a lower occupancy level, you're not able to leverage a higher rate."

According to data from hospitality consultancy HVS, average room rates in Goa hotels declined by as much as 5% in October and occupancy fell up to 2 percentage points over the corresponding period in 2023. In September, though, occupancy increased by 2-4 percentage points, while average rates declined by 2-4%.

Better deals in December

Minthas learnt that several hotel companies that would insist on gala dinners as a mandatory buy-in are steering clear of the idea this year. That deal generally bumps up the cost of a room night by several thousand rupees per person and binds hotel guests.

Also, unlike in previous years, flights to Goa are not astronomically priced. Most airlines from big cities charge ₹13,000-15,000 for flights during the two holiday weeks at the end of the month.

According to Rajiv Mehra of the Indian Association of Tour Operators, who is also director of Uday Tours and Travel Pvt. Ltd, it will be business as usual in Goa this year for Christmas and New Year.

"Taxis and last-mile connectivity can be a bit problematic in the state due to the absence of ride-hailing services, but that has been the case for some years now and repeat travellers have now found workarounds," he said.

Subhash Goyal, chairperson of STIC Travel Group, added that while there is a drop in their international tour packages to Goa, domestic travel will grow in low double-digits this season.

"Many domestic travellers have now been to Goa and are well-versed with how to make their way to their hotels despite the taxi lobbies. Generally, we like to promote all-inclusive tour packages so that travellers remain safe," he said.

OPEN IN APP

ABOUT THE AUTHOR

Varuni Khosla

Varuni serves as a Senior Assistant Editor at Mint. Her responsibilities encompass crafting compelling narratives that take a deep dive into hospitality companies, the business of art, luxury brands, the intricacies of the business of sports, advertising and marketing landscapes, gaming insights, tourism and travel industry trends. She also covers alcohol commerce. She is skilled at communication, meticulous research, and insightful analysis keeping contemporary shifts and advancements within the lifestyle and business domains at the heart of her work.