Work

10 Apr 2009

cutbacks leaving prices in the dust

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Posted in Work | 3 Comments

I’m just after booking a hotel in dublin for next week. I’m shocked by the prices of all city centre hotels – they haven’t budged since the last few times i’ve booked hotels.

I doubt every single hotel is near capacity in midweek, so i’m left wondering how long can they afford to keep prices so high?

Brown Bricks
Creative Commons License photo credit: shaire productions

This is partly the reason why this country is going to prolong a recession. People are admitting there is a recession (which is step no.1 to recovering), they’re cutting back (step no.2), firing people etc… but prices are not being lowered. The cost of living hasn’t changed…

If we look at air travel, Ryanair have been bullied in to upping their prices by all sorts of government taxes and levies. Last year, i bought flights to london for 4c with ryanair. This year, i paid €90 which sums up how things have changed.

Luas prices have GONE UP since this time last year.

It’s the same with houses, with cars, with groceries, with everything… prices aren’t generally going up (they are going down), but they’re not moving with reality and as a result people are being priced out of buying things which only adds to economic problems.

D4 hotels have been running cheap offers since christmas – started off as €10 per night, it’s now about €40 per night which is great value. The hotels however, are old and not very welcoming. Fine if you’re stuck for a bed, but as for a holiday or mini-break, i’d rather stay at home… still, it’s an attacking business strategy and one that’s paying off. I admire that.

I was watching a problem about the ‘millionaire mansion suicide’ last night. Full story here for those who don’t know about it.

It sums up how some people view money – they’d rather kill themselves than have to deal with financial meltdown, bad debts, repossession of houses etc… that case was triggered by a recession – people do not like losing what they have and what they have gotten used to.

There is a link between recession and suicide, naturally enough. This recession will be no different and probably an awful lot worse than any other for suicide rates as people nowadays have much more to lose than they’ve ever done in the past. The stakes are much higher and with that comes pressure – something we’re never really trained or educated to deal with properly.

  • http://hardcorefornerds.blogspot.com gabbagabbahey

    whatever about the issue of hotels and the rest of your economic analysis, where you have some good points, the examples of cost strike me as a little off.

    “Ryanair have been bullied in to upping their prices by all sorts of government taxes and levies” – Ryanair can charge whatever they want, they just have to add tax on to it. like anything else you buy! calling it bullying is to have a unusually specific sense of sympathy for Ryanair.

    in any case, to judge 4c (which is an obscenely small amount given the environmental cost of the travel) against 90 is not a real economic comparison – that’s the way Ryanair fares have always worked.

    and what do you think powers the Luas?

  • http://www.smemon.com smemon

    at a time when airlines are stuggling and numbers are down for the first time in a decade (last year), what do the government do to help matters? introduce a 10 ‘travel tax’ – only an idiot will defend that decision – it makes no sense whatsoever…

    ryanair has always taken advantage of people who are not tech savvy. Credit card charges, baggage charges, priority tickets etc… if you’re not careful free flights turn in to costly ones ;-) There are of course ways around all that, but the fact of the matter is the cost of flying from ireland has increased by 10pp when the country is in a recession.

    so it costs me more to travel now than it did 12 months ago, despite the fact fuel prices have gone down (although the government are doing their best to tax them up to the levels we seen last summer).

    bus and rail costs have gone up, even for students – nobody is left untouched.

    why not sell aer lingus and gather cash that way rather than going after people who are already paying left, right and center for other things.

    if you continue to tax people, guess what? people just won’t spend… people don’t have magic pools of money to dip into. The more you tax people, the less they spend. They less they spend… well i don’t even have to answer that.. the evidence is pretty clear :mrgreen:

  • Guest

    I totally agree with you, Im from Carlow and stayed in D4 hotels before as you said not very welcoming, Last time I was in Dublin  I stayed in a lovely place called the Sandymount Hotel (beside Aviva Stadium), it was very reasoably price and what I liked was the welcoming atmosphere, its a family run hotel and has retained that intimate feeling as well as a good price point incidentally the food was great too! On the subject of air travel I couldnt agree with you more, the taxes are only an incentive not to travel both in and out of Ireland. I booked flights to London recently that cost 140 euro, then they bang the taxes on at the end which makes the purchaser feel tricked! Very frustrating for individuals and our economy!