Taking a cue from the airline industry, leading international hotel chain Hyatt on Thursday, announced a flat discount on its daily room rate, as a ‘Monsoon Flash Sale’.

The hotel chain will sell its rooms at a 50 per cent discount for bookings made between August 1–15, for stay between August 1 and October 31, and again from December 16 to January 10, 2015.

The discount will be available for any length of stay, at all its 19 properties across the country. This would mean an upscale hotel room at Hyatt may be priced at ₹4,000 or even less. Harleen Mehta, Vice-President (Sales), Hyatt South West Asia, told BusinessLine that the offer will be on limited inventory.

New trend

Responding with a ‘no’ to a question on whether the intention was to trigger a price war in the industry, she said: “We want to make our products available to a wider audience, especially during this period when there are a lot of long weekends and festivals.”

But, industry sources say the move will mount pressure on other operators in the industry.

“This may trigger a price war in the already bottomed-out hotel industry. We cannot take it lightly, as it may set a new trend in the hospitality sector,” said T Nataraajan, Honorary Secretary, South India Hotel and Restaurant Association and CEO of GRT Hotels and Resorts.

He said it would be very difficult for other hotels to react to this in the same measure as most of them are operating on a wafer-thin margin.

“At a time when room rates are selling at a huge discount already, another 50 per cent discount on daily rate may spell disaster for many.” He pointed out that most of Hyatt’s properties in India have a huge room inventory, and hence overheads on per-room basis will be relatively lower, giving the chain a leeway. “However,” Nataraajan felt, “it is a bold move.”

While the senior executives of home-grown hotel chains such as Taj and ITC Hotels could not be reached for comments, Rajeev Menon, Area Vice-President, South Asia, Marriott International, said his hotel did not believe in price wars.

“We generally do not react to these price wars. Besides, in India, we are the market leader in terms of average revenue per available room, and there is hardly any need for us to give a knee-jerk reaction to this.”

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