Dec102013

Brazil Tourist Board upset over World Cup 2014 high room rates

Between June 12 and July 13, 2014 there are expected to be about 600,000 foreign tourists in Brazil for 2014 World Cup. Embratur, the Brazilian Tourist Board, reports the average hotel room rate for Rio de Janeiro is $461 per night during World Cup. This compares to $274 per night in Q1-2013.

Embratur has asked for FIFA’s help to bring down the price of hotel rooms which have risen as much as 500% for World Cup dates. While high room rates might be seen by hoteliers as a welcome source of revenue, Embratur is concerned the high room rates will deter tourism after World Cup 2014. Brazil is also host to the 2016 Summer Olympics.

The Brazil Justice Ministry director of the consumer rights secretariat released a statement:

“Tourists are consumers which require special protection because they are outside of their city or country,” Amaury Oliva, director of the ministry’s consumer rights secretariat, said in a statement. “We are working to make sure that they are well received and that the services we provide have quality and fair price.”

FIFA contracted with Swiss-based booking agency Match Services to sell hotel rooms for the World Cup 2014. It is reported that Match is marking up already high room rates by more than 40% on the rate contracted with the hotels.

There are 12 host cities in Brazil for the World Cup 2014 football/soccer events. Match negotiated contracts with 800 hotels when Brazil won the World Cup 2014 bid in 2007. Embratur says rates at these hotels have increased by 2x to 5x their average rate.

The response from Match Services is they do not regulate room rates and the rates reflect the hotel operators increases.

The tourism board, or Embratur, this year showed that rates will rise up to 500 per cent during the World Cup in some hotels offered by the FIFA-appointed agency MATCH Services, prompting several consumer rights groups to demand action from the government.

Brazilian President Dilma Rousseff last month created a committee to monitor abusive price hikes of hotel rates and plane tickets during football’s showcase event.

The government also said it will investigate whether MATCH, FIFA’s official accommodation agency, was involved in “cartel” practices that may lead to price hikes during the World Cup, a claim that FIFA and MATCH have repeatedly denied.

Brazil sports minister Aldo Rebelo, the government official in charge of preparations for the World Cup and the 2016 Rio Olympics, earlier this year pledged “zero tolerance” for hotels charging abusive room rates. He said significant hikes would hurt Brazil’s image abroad and threaten to scare tourists away.

CTV News Canada

There are expected to be about 3,000,000 Brazilians attending World Cup 2014 matches along with 600,000 foreign tourists.

The study by the tourism board, known as Embratur, compared prices in several dozen hotels in the 12 host cities. It was conducted through researching prices announced on booking websites, the hotels’ sites and FIFA’s official web page.

Embratur did not say exactly how many hotels were compared, but of the 65 hotels listed in the study’s results 22 increased prices more than 200 per cent, with six offering rates at least 300 per cent higher. The biggest increase was by a hotel in the northeastern city of Salvador, which will charge $509 per night during the World Cup, a 583 per cent increase compared to the $75 it charged this July.

The host cities with the smallest increase in rates are Recife and Sao Paulo, with hikes of about 100 per cent on average. The capital of Brasilia had the most expensive hotel in the study, with certain rooms costing $639 per night, a 376 per cent increase compared to the current price.

The study showed that the average cost for a room in Rio de Janeiro during the World Cup will be $461, more than double the rate in Johannesburg for the 2010 World Cup final in South Africa.

CTV News Canada August 2013.

Here are a couple of examples of room rates I located at brand hotels in Brazil during World Cup 2014:

June 11-13, 2014 Sheraton Rio de Janeiro $777.

USA-Germany match June 26, 2014 Recife, Brazil

Best Western Plus Vivá Porto de Galinhas (25 miles from Recife) $1,334 for 4 nights June 24-28, 2014. $667 for 2 nights June 26-28. No availability for one night stays.

Best Western Manibu Recife hotel is not available for all of June or July 2014.

About Ric Garrido

Ric Garrido of Monterey, California started Loyalty Traveler in 2006 for traveler education on hotel and air travel, primarily using frequent flyer and frequent guest loyalty programs for bargain travel. Loyalty Traveler joined BoardingArea.com in 2008.

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Comments

  1. If you think hotel prices are bad there for that period, you should check out some of the prices people are being asked for rental apartments and houses during the time.

    I expect some people will end up finding much better prices after the World Cup has begun there.

  2. I can remember room rate gouging as far back as the (1962?) World’s Fair in Seattle. Real hotels were demanding and getting 4x-5x their standard rack rates. Spare rooms and even garages in private homes were rented for amazing sums. There were lots of complaints and publicity that eventually led to simple max rate declarations that were not and are not enforced fifty years later. Those who complained lost.

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