The effective rate (Rev PAR) decreased -64.2% in the third quarter.

With the beginning of the partial opening of non-essential activities, the hotel industry resumed its operations with permitted occupancy percentages not exceeding 30% in most cases, as well as with the implementation of sanitary protocols to guarantee the safety of the hotels’ guests and staff working in hotels. As a result, the effective rate index calculated by GEMES registered a rebound in the third quarter, going from 10.1 points to 34.4 points, which nevertheless continues to remain well below historical levels.

The effective rate index (RevPAR) is -64.2% below the level it had in the third quarter of 2019, which is due to the combination of a -7% drop in the average room rate and a decrease in -37.4 percentage points in the average occupancy, with respect to the hotel occupancy that was registered in the third quarter of 2019.

As a result, the hotel industry continued to present very unfavourable results in the third quarter, which has led it to be unable to recover the level of employment it had before the crisis. According to figures from the Mexican Institute of Social Security, at the end of last year there were 419.9 thousand people employed in temporary accommodation services; for the first quarter of the year, with the first effects of the pandemic, they were 361.6 thousand, while for the second and third quarters, these figures were 302.9 thousand and 301.7 thousand jobs, respectively.

In the future, the results will depend on the fact that tourists and visitors, both national and international, regain the confidence that they can travel and stay safely, as well as the progress achieved in terms of the epidemiological traffic light, so that hotels are allowed to operate with higher capacity. Unfortunately, there are numerous states that remain on an orange traffic light and some of them have even returned to the red traffic light which means high risk.

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