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Industry Expenses Will Rise in 2003 |
Break-Even Occupancy to 47.4% NEW YORK, Jan. 24, 2003 -- As a result of some expenses that will rise,
or costs that will need to be reinstituted, PricewaterhouseCoopers forecasts
that the total expenses per available room will rise by 1.9 percent, or
$21,800, to $22,200 in 2003, or expressed differently, total expenses per
occupied room basis will increase by 0.8 percent, or from $36,700 to $37,000.
Table. 2002 Expense Reductions at Full-Service Lodging Properties . |
Therefore the decline in profits was reduced and the trend is shown
in the chart below:
Chart. Aggregate Lodging Industry Profits
"Some of the cost reductions that management initiated in 2001 and 2002 will become institutionalized, but some can only continue for a limited time or they will increasingly affect the quality of facilities and guest service," said Bjorn Hanson, Ph.D., global industry leader, PricewaterhouseCoopers Hospitality & Leisure Practice. PricewaterhouseCoopers research indicates that the following expenses
will rise or need to be reinstituted in 2003:
5. Utility costs could increase between four and eight percent in 2003, given the recent disruptions to oil sources and uncertainties in the global oil market. PricewaterhouseCoopers Hospitality & Leisure research specialists develop lodging industry forecasts using econometric models. They assist clients in understanding past and future lodging industry trends. Hospitality & Leisure research specialists have applied advanced statistical and econometric techniques on a variety of engagements, making a difference to clients' profitability, market share, strategic direction, and visibility in the marketplace. |
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PricewaterhouseCoopers Wendy Amstutz +1 646 471 5079 [email protected] www.pwcglobal.com |