Head of Ireland’s biggest hotel chain warns against price gouging 

Pat McCann, head of the country's biggest hotel chain, has warned his own industry against price gouging over the summer.

Dalata, whose brands include the Maldron and Clayton hotels, also said the government needs to extend wage supports in the sector beyond June when hotels and guest houses are expected to re-open.

“If you damage those relationships [with customers] you tend to damage them forever, [hotel managers] will make sure what they are doing is fair and reasonable,” Pat McCann, out-going CEO of Dalata, said.

“The idea that everything is going to change and prices are going to go through the roof, that’s not going to happen,” he said.

Dalata does not expect much international leisure tourism back into Ireland this year, instead it will be focused on attracting domestic tourists. 

Mr McCann’s warning on the risk of raising prices was backed up by the company’s chairman, John Hennessy, who said that each general manager of the Dalata hotels has their own autonomy around pricing.

“They are existing in a local market and the one thing they need to do is protect that market and relationships with people in that market. The last thing they are going to do if they want to do that is engage in any price gouging,” Mr Hennessy said.

However, Dermot Crowley, who is taking over as head of Dalata, also said that “when demand is high, prices tend to go up and when demand goes back down there is great value to be got.”

Dalata has 29 hotels in Ireland and the UK. It is currently developing a further 13.

There will never be better value in visiting Dublin then this summer, Mr Crowley said.

“I think there will be great value in that respect,” he added.

The hotel and tourism industry has been among the beneficiaries of government supports introduced to help businesses impacted by the Covid-19 pandemic.

The system here has “really encouraged you to keep people in employment. It has been vital to the industry,” Mr Crowley said.

He added that government can’t “go to a point where that [support] gets cut straight away. ”

“The idea of cutting it at the end of June, that would cause a lot of issues for a lot of hoteliers,” he said.

Looking forward, the company intends focusing its expansion on the UK.

“Preferable we would take over existing leases from operators in the UK,” Mr Crowley said.

Dalata reported a loss of €3.6m for the first three months of this year.

Over the three months to 31 March occupancy rates at its hotels were 14pc in Dublin, 16pc in regional Ireland and 13pc in the UK.

For the full year 2020, the company reported revenue of €136.8m and a loss after tax of €100.7m as the Covid-19 pandemic battered the tourism industry.