US Financial Crisis is Putting Pressure on French Tourism Industry

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US financial sector meltdown, weak dollar, higher flight ticket prices, strong Euro, and economic uncertainty have the French travel industry worried.

Now, we must shift our focus elsewhere.

US financial sector meltdown, weak dollar, higher flight ticket prices, strong Euro, and economic uncertainty have the French travel industry worried.

The financial crisis so far has centered on big banks, brokers and wealthy Wall Street CEO's. While the debate on whether the reverberations on the "main street" will be felt or not is still raging, the effects on small tourism firms in Paris are already felt.

"I am surprised how quickly the blow came," says Anne, the Managing Director of "Private Homes," a small apartment rental company in Paris, France specializing in renting apartments and studios at Paris' central areas. "We are very much dependent on the US tourists and their money," she continues. "Now, we must shift our focus elsewhere." Her company's site http://www.paris-apartments-for-rent.com has received hundreds of visitors per day from US. Now, the traffic and hence the number of applications have taken a hit. "This is not the result of seasonality, search engine rankings or the amount of advertising we do," she assures.

While the strains of weak dollar, higher ticket prices and stronger Euro on US-dependent French travel companies are not new, the Wall Street financial meltdown is.

"The recent crisis is different. Yes, the plummeting dollar has had a negative effect on our business but we had managed to focus our offer in such a way as to overcome such obstacles. I mean, the game has changed rather dramatically. Whereas before our US customers had to account for the fact that their dollars do not go as far as they used to here in Europe, they still managed to account for that. I guess people's thinking went something like: 'Oh well, I will just stop going to Starbucks for a while when I come back to US.' The 'fear factor' has not been there. People were not afraid of whether they will have a job when they come back home. Now they do. Now everybody seems to wait for what may happen next," explains Anne.

Not all seems to be doom and gloom according to recent French hotel industry report released by http://www.hospitalitynet.org despite the world's current gloomy economic situation, initial results for summer 2008 are mostly positive for the French hotel industry -- which rose in July and August 2008 by 4% compared to the corresponding period last year to reach nearly 1.1 billion Euros. Its writers seem to forget that the summer of 2008 has ended in the US financial disaster and not begun. The initial successes might indeed hide the slump which came later on.

Many of the inter-connected banks and financial institutions that went under in US did so in a matter of days. However, the effects on other businesses in US and elsewhere in the world do not seem to be as immediate. But they are. It may be that simply that the outcome of what is already happening has not been summed up, the financial sheets have not yet been submitted and analyzed, business owners have not yet run their balances for the quarter or simply analyzed their results. Whatever the case, the internet traffic and trends are often a good indication of the direction in which things are moving. If the search volume for a particular product or service falls, the real financial outcomes for the company providing them are usually not far behind.

"People seem to be still waiting to see the outcome of the recent crisis on the small business," continues Anne. "Here we already know what it is."

For additional information on the news that is the subject of this release, contact Anne Julio or visit http://www.paris-apartments-for-rent.com.

About Private Homes:
Private Homes is a French company located in Paris, France specializing in short and long term apartment rentals in Paris.

Contact:
Anne Julio, Managing Director
Private Homes
Tel: 33 1 73 77 27 23 / US: +1 (415) 315 95 44 - UK: +44 (0)20 8133 7602
http://www.paris-apartments-for-rent.com

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Anne Julio
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