Introduction
In recent years, the value of the Swedish krona has experienced a significant weakening against major currencies such as the euro and the dollar. This currency shift has had notable effects on Sweden’s tourism and hotel sector. A weaker krona makes it more cost-effective for international visitors to travel to Sweden, potentially increasing the number of foreign tourists. At the same time, Swedish travelers find it more expensive to vacation abroad, which may lead to a rise in domestic tourism. This article explores how these dynamics are influencing Sweden’s hotel market and whether the country is now perceived as a more affordable destination for international tourists. The statistics in this article are sourced from visita.se and travelnews.se.
The development of international guest nights
Increase in Nordic guests
In 2023, there was a notable increase in overnight stays from neighboring Nordic countries, particularly Denmark and Finland. Danish guest nights rose by an impressive 30 percent, while Finnish guest nights increased by 24 percent compared to the previous year. The weakened Swedish krona has made Sweden a more affordable destination for these visitors, contributing to the rise. Regions like Dalarna have experienced a significant boost, with a marked increase in Danish tourists.
European tourists and the role of currency
Visitors from other European countries have also increased their travel to Sweden. Germany, one of the top tourism markets for Sweden, experienced an 8.9% rise in overnight stays in 2023. The weakened Swedish krona has made it more affordable for Germans and other Europeans to visit, driving growth in tourism. Despite this positive trend, European overnight stays have not yet returned to pre-pandemic levels, indicating there is still room for further growth.
Non-European visitors
The recovery among non-European visitors has been slower. Visitors from North America, particularly the United States, have increased, partly due to a strong dollar making Swedish destinations more affordable. The number of American guest nights rose by 17 percent in 2023. However, the number of Asian visitors, especially from China, has not recovered at the same pace and remains well below pre-pandemic levels.
Effects on hotel economics
Occupancy rates and profitability
The increased influx of international guests has positively impacted hotel occupancy rates and profitability. In 2023, the number of hotel overnight stays rose by 4.5% compared to the previous year. This growth has led to higher revenues for hotels, although the increase in foreign guest nights has not entirely offset the decline in Swedish guest nights.
Price adjustments and strategies
To capitalize on the increased demand from international visitors, many hotels have adjusted their pricing strategies. By offering competitive rates and attractive packages, often compared to competitors in neighboring countries, hotels have successfully attracted more guests and boosted their revenues. The weaker Swedish krona has also enabled hotels to provide more favorable prices to international visitors without compromising profitability. At the same time, hotels have had to carefully balance their pricing to avoid discouraging domestic guests, who may be more price-sensitive due to increased costs for imported goods and services.
Regional differences
Urban areas versus the countryside
Major cities like Stockholm, Gothenburg, and Malmö have experienced strong growth in overnight stays, particularly from international visitors. Stockholm County recorded a 5.5% increase in overnight stays in 2023, while Skåne and Uppsala counties grew by 4.4% and 4.3%, respectively. This growth is attributed to the cities’ appeal and their wide range of cultural and commercial attractions. At the same time, some rural regions have continued to benefit from domestic tourism, especially during the pandemic when Swedes opted for staycations.
Specific examples from counties
Regions such as Dalarna have seen a significant increase in foreign visitors, particularly from Denmark. This trend has favoured local hotels and other accommodation facilities. On the other hand, counties such as Jämtland have experienced a decrease in Swedish guest nights, which has negatively affected the local tourism industry.
Future prospects for the hotel market
Forecasts for 2025 indicate a continued positive development for the hotel market, with an expected increase in both domestic and international visitors. The weak krona is expected to continue to make Sweden an attractive and affordable destination for foreign tourists. At the same time, an improved global economic situation and easing of travel restrictions may contribute to an increase in non-European visitors, especially from Asia and North America.
Summary and recommendations
One way to maximize the benefits of these trends is for hotels to implement dynamic pricing to optimize revenue and attract a broader customer base. Targeted marketing towards specific audience groups, based on their unique preferences, needs, and geographic location, can also help increase occupancy rates. Additionally, it is crucial to continuously enhance the guest experience by providing high-quality service and tailored offers.
In summary, the weak Swedish krona has both created new opportunities and posed certain challenges for the hotel industry. By staying flexible and adapting to the changing circumstances, hotels can not only navigate these challenges but also achieve growth in this evolving landscape.
