Hotels Blame High Costs, Politics For Weak World Cup Demand

The FIFA World Cup, which was widely expected to trigger a major tourism and hospitality boom in the United States, may fail to deliver the economic impact many hotels had anticipated, according to a new industry report.

A report produced by the American Hotel & Lodging Association (AHLA) revealed that hotel bookings are “well below expectations” in almost every World Cup host city despite FIFA’s announcement that more than five million tickets have been sold.

The AHLA warned that the booking trend “does not align with Fifa’s statement that more than five million tickets have been sold” and said it “creates a risk that ‘the anticipated economic lift may fall short’.”

The association, regarded as the largest hotel body in the United States, represents more than 32,000 hotel properties and over 80 per cent of all franchised hotels across the country.

According to the report, the poor booking outlook has raised concerns within the hospitality industry that the World Cup could fail to generate the financial windfall many businesses had projected when the United States secured hosting rights for the tournament.

The AHLA partly blamed FIFA for the situation, accusing world football’s governing body of overestimating accommodation demand by reserving too many hotel rooms for official use.

The report accused FIFA of “block-booking far too many rooms for its own use and creating false demand.”

According to the AHLA, the strategy “led to artificially high pricing which, after Fifa cancelled a large number of rooms, has been replaced by a vacuum of availability.”

Hotel operators argue that the initial room shortages pushed prices upward in many host cities, discouraging some potential visitors from making early travel plans.

However, once many of the reserved rooms were released back into the market, hotels were left with excess inventory and weaker-than-expected demand.

FIFA, however, dismissed the allegations and said it “does not recognise this accusation.”

Beyond accommodation issues, hotels also identified other factors they believe are affecting travel demand for the tournament.

According to the report, “high match ticket pricing, local transport and tax costs, and the political backdrop have put visitors off.”

Industry stakeholders fear that many football fans may instead turn to short-term rental platforms for accommodation during the competition.

Airbnb is already positioning itself to benefit from the event, with the company reportedly describing the tournament as the “biggest hosting event in Airbnb’s history”, surpassing even the 2024 Olympic and Paralympic Games in Paris.

Analysts within the hospitality industry say hotels may still see an improvement in occupancy rates during the knockout stages of the tournament, when travelling supporters are more likely to make short-notice bookings depending on their teams’ progress.

For now, however, uncertainty remains over whether the World Cup can meet the lofty financial expectations attached to hosting one of the world’s largest sporting events.

Despite hopes for a late surge in bookings, many in the industry fear the tournament “seems unlikely to bring in the revenue that was being predicted.”