UniCredit Bank Austria analysis:
Austria's tourism industry under pressure due to high costs
- The Austrian tourism industry achieved a record result in 2024 with 154.3 million overnight stays. The tourism sector is on track to break another record in 2025
- A new high is also expected for tourism revenues in 2025, following a record figure of €32.2 billion in 2024 and a 5 per cent increase in the first half of the year compared to the same period last year
- However, high costs are weighing on revenues. Adjusted for price changes, revenues in 2024 were 15.4 per cent below the 2019 figure. The negative trend continued in the first half of 2025.
- Real revenue per overnight stay has fallen to just 85 per cent of the 2019 level.
- High inflation is leading to bookings of cheaper accommodation and savings on incidental expenses
- Substantial wage increases and a sharp rise in energy prices are making holidays in Austria more expensive than in other holiday destinations. Austria is losing its price competitiveness and attractiveness
- The high importance of tourism for the Austrian economy, with a direct value added share of 4.4 per cent of GDP and more than 220,000 employees, is being put to the test.
“The Austrian tourism industry is celebrating a continuation of record results in guest overnight stays and revenues in 2025”, says UniCredit Bank Austria Chief Economist Stefan Bruckbauer, adding: “But all that glitters is not gold. Due to high inflation, the real value of tourism revenues is significantly below pre-pandemic levels. Guests are responding to the high price increases by booking cheaper accommodation and cutting back on incidental expenses. In an international comparison, Austria is losing its price competitiveness and attractiveness as a holiday destination. The high importance of tourism for the Austrian economy is under threat.”
2024 overnight stay record could be surpassed in 2025
After the pandemic-related slump, the tourism sector in Austria made a strong comeback. In 2024, more overnight stays were recorded than in 2019 for the first time. With 154.3 million overnight stays, the previous record result from 2019 was exceeded by 1.5 million overnight stays or 1.1 per cent. The positive trend continued in the first half of 2025, albeit at a slower pace. With 76.2 million overnight stays, the result for the first six months of 2024 was exceeded by half a percent. “A new overnight stay record for 2025 is within reach, thanks to the increase in overnight stays by domestic guests. Overnight stays by foreign guests have stagnated so far this year, apparently weighed down by a decline in the attractiveness of Austria as a holiday destination compared to alternative holiday destinations”, says UniCredit Bank Austria economist Walter Pudschedl.
Not all federal states were able to set a new record for overnight stays. The improved development of domestic tourism benefited federal states with a high proportion of domestic overnight stays, such as Burgenland, Upper Austria and Styria. In contrast, federal states with a high proportion of foreign holidaymakers, such as Tyrol and Carinthia in particular, recorded even lower overnight stays in 2024 than in 2019. The strongest growth was achieved by the federal capital Vienna, supported by the general trend towards city tourism.
Record high tourism revenues, but significant losses when adjusted for inflation
A new record was also set in 2024 for nominal revenues from travel. Compared to 2024, revenues increased by 5.8 per cent. With €32.2 billion from domestic and international travel combined, Austria generated almost €5 billion or 17.8 per cent more revenue than in 2019, the year before the outbreak of the coronavirus pandemic. In the first half of 2025, tourism revenues rose by 5 per cent year-on-year to €17.1 billion, which suggests a new record high for the year as a whole.
However, adjusted for price changes, revenues in 2024 were 15.4 per cent below the 2019 figure, as the nominal increase in revenues of just under 20 per cent during this period was offset by inflation of 39.3 per cent in the accommodation and restaurants product group. In view of the sharp rise in the cost of tourism services in the first half of 2025, averaging 5.7 per cent, and a 5 per cent increase in revenue compared with the same period last year, the decline in the real value of tourism revenue continued in the first six months.
Although Austrian tourism businesses are generating higher revenues in nominal terms, when adjusted for inflation, the bottom line is that they are left with less than before the pandemic. This is reflected in the decline in real value added in the accommodation and catering sector by 0.3 per cent in 2024 and 2.5 per cent year-on-year in the first half of this year. According to Pudschedl, “2025 is therefore likely to be the second year in a row in which the value added of the accommodation and catering sector will decline in real terms, while the economy as a whole has found its way out of recession.”
Higher prices changed guests' spending behaviour
Revenue growth is not keeping pace with the increase in overnight stays. The real value of daily tourist spending in Austria is currently only 85 per cent of the level before the outbreak of the coronavirus pandemic. “The sharp rise in prices in the catering and accommodation sectors has not dampened the desire to holiday in Austria. However, domestic and foreign guests were unable or unwilling to increase their holiday budget in line with price developments, but have adapted their spending behaviour in view of the price increases”, says Pudschedl, adding: “On the one hand, tourists are saving on incidental expenses such as restaurant visits, and on the other hand, guests are booking cheaper accommodation than before.”
Overnight stays in hotels and private accommodation have fallen, but camping is booming
Compared to 2019, overnight stays in hotels fell by 3.4 per cent in 2024. However, this decline is only attributable to cheaper hotels in the lower categories. In contrast, overnight stays in upmarket hotels (5/4 stars) were 0.5 per cent higher in 2024 than in 2019. The number of overnight stays in private accommodation also fell compared to 2019. The decline in overnight stays in hotels and private accommodation was more than offset by a sharp increase in stays at campsites of over 19 per cent. In the first half of 2025, the overnight stay trends of previous years continued, although budget hotels saw a slight increase in the first six months at the expense of a slight decline in demand for campsites.
High price increases threaten Austria's competitiveness in tourism
Although the Austrian tourism industry was able to absorb the losses caused by the pandemic, the inflation shock triggered by energy price developments now appears to be causing lasting damage. Substantial wage increases to compensate for high inflation have led to significant cost increases, which in turn have necessitated corresponding price increases.
Prices for tourist services in Austria have risen by over 48 per cent since 2019, while average inflation was “only” 30 per cent. Price increases for tourist services were significantly lower in most alternative European destinations such as France, Spain, Greece and Italy, ranging between 16 and 30 per cent over the same period, according to. The Austrian tourism industry has thus lost a significant amount of its price competitiveness.
“The current record number of overnight stays and nominal record revenues should not obscure the fact that the high importance of tourism for the Austrian economy, with a direct value added share of 4.4 per cent of GDP and more than 220,000 employees, is being put to the test by the loss of competitiveness. The challenge for the Austrian tourism industry in the coming years will be to gradually offset the cost disadvantage through productivity gains and to focus more strongly on above-average spending power tourists with a higher quality and experience offering”, concludes Bruckbauer.
Further information: All that glitters is not gold in Austrian tourism, Unicredit Bank Austria, October 2025
Enquiries:
UniCredit Bank Austria Economics & Market Analysis Austria
Walter Pudschedl, Tel.: +43 (0) 5 05 05-41957;
Email: walter.pudschedl@unicreditgroup.at