Cost explosion threatens Austria's tourism: alarming situation in 2025!

Cost explosion threatens Austria's tourism: alarming situation in 2025!

There is currently a worrying mood in the Austrian tourism industry, even if the number of guests remains at a high level. According to that Tourism barometer 2025, which was created by Deloitte and the ÖHV, over 200 tourism experts gave their assessments of the economic situation in the industry. The overall grade is a worrying 3.06, which represents a downgrade compared to the previous year. This situation is further exacerbated by the high costs of personnel, energy and goods, with ongoing wage increases not being able to be fully passed on to guests.

Although demand has returned to pre-pandemic levels both domestically and in inbound tourism, revenues are declining sharply. In the surveys, 40% of tourism businesses stated that they feared their financial situation would deteriorate in the summer. The booking situation also remains positive, but the high costs represent an existential threat that is helping to push companies to their economic limits.

Political support needed

In order to meet the challenges, increased efficiency improvements and strategic pricing are necessary. Politicians are called upon to take decisive measures to counteract inflation and rising costs and to reduce bureaucratic hurdles. It is also worrying that 42% of companies have scaled back planned investments and 35% are planning restrictions in the next five years due to the economic situation.

The situation on the credit market is also tense: almost half of those surveyed reported more difficult financing conditions. As a result, 36% of borrowers were asked to provide higher collateral. While 39% choose variable interest rates, 23% rely on fixed interest rates and 38% use a mixture of both.

Positive approaches and outlooks

In contrast to the concerns in Austrian tourism, the data from East Germany shows a positive development. According to that Ostv.de tourism barometer The region recorded around 27.9 million guests and 84.5 million overnight stays in 2023. This represents the third highest number of guests after 2018 and 2019 and shows an increase in overnight stays of 5.4 percent compared to the previous year.

Although East Germany is 3.8 percent behind the 2019 level, incoming tourism achieved a pleasing recovery with an increase of 17.7 percent. The incoming demand level is on a solid track at almost 93 percent of the 2019 value. The development of the federal states remains homogeneous, with urban regions in particular recording significant growth.

Given the challenges and opportunities, the tourism industry is at a crossroads. Political support and smart strategies are absolutely necessary to ensure competitiveness and lead the industry into a successful future.