Jan. 24 (Bloomberg) -- Sochi may attract the fewest American visitors to a Winter Olympics in 20 years amid terrorism concerns, a lack of luxury hotel rooms and difficulties procuring visas, according to U.S. tour operators.
Russia’s plan to spend $50 billion on hotels and other infrastructure to convert a small city on the Black Sea into a year-round resort hasn’t resulted in enough high-end hotels, and the existing facilities have raised prices by 121 percent for the event, according to trivago.co.uk, a U.K. website.
Russia’s Olympic organizing committee said yesterday that 30 percent of tickets remained unsold three weeks before the Feb. 7 opening ceremony. The Vancouver Games in 2010 wound up selling 97 percent of its seats. With few international flights directly into the Sochi airport, and most Westerners requiring visas, a last-minute rush is unlikely, tour operators say.
“There was a little hesitancy to start and now with everything going on, I don’t expect that we’re going to have a lot of people still coming to us,” said Robert Tuchman, president of New York-based Goviva, a sports and entertainment travel company. “This is definitely, from a travel perspective, a low point in terms of a Winter Olympics that I’ve seen in the 20-plus years I’ve been doing it.”
The U.S. State Department on Jan. 10 issued a travel alert for Russia after two suicide bombings in the city of Volgograd late last year killed more than 30 people. The warning urged Americans to “remain vigilant and exercise good judgment and discretion when using any form of public transportation.”
Sochi has planned to sell 1.1 million tickets, according to an International Olympic Committee marketing document, meaning about 330,000 remained available as of the latest update from the organizing committee. Of 1.54 million tickets available for the Vancouver Games in 2010, 97 percent, or 1.49 million, were sold. The Canadian Olympic Committee said it didn’t have information on last-minute sales for the 2010 games.
Sochi still can approach Vancouver’s sales, even if the organizers have to offer discounts to local schools or community groups, according to Janice Forsyth, director of the International Centre for Olympic Studies in London, Ontario.
“It’s difficult to say how close to the mark Sochi will be considering the terrorism threat -- that was something Vancouver didn’t have to deal with,” Forsyth said in an e-mail. “They need to show that they can run a successful games, and selling tickets, even if they almost have to give them away, is one way to demonstrate that.”
Bookings at Chicago-based Sports Traveler for the Feb. 7-23 Olympics are down by 80 percent of what was expected, according to Anbritt Stengele, its president and founder.
“It’s been a disappointing piece of our business,” Stengele said in a telephone interview. “It started to fall apart when the pricing came in from our hotel suppliers.”
Accommodation, particularly the absence of four- and five- star properties, has been the biggest obstacle, according to several tour operators.
“Olympic travelers tend to be high-end travelers and most of our hotels have been three stars,” Stengele said. “We only have access to one four-star property in the mountains. It’s really put a damper on our sales.”
Russian President Vladimir Putin is trying to turn the resort into a destination for wealthy tourists. Along with a stadium, ice rinks and ski slopes, there are some top-class hotels being built, though not enough for the clientele the Olympics draw.
U.S. travel agents aren’t the only ones facing hotel shortages. At Sportsworld, a TUI AG-owned company in Abingdon, England, that’s the official Sochi ticket agent for Denmark and Liechtenstein, accommodations have been the “No. 1 bottleneck,” according to Len Olender, its sponsor services director.
Olender said international attendance will be on a par with Lillehammer, Norway, in 1994, and Turin, Italy, in 2006.
“It’s a celebration for Russia, for Russians,” Olender said in a telephone interview.
It also has the potential to be the focus of some of the country’s disputes. The U.S. State Department alert said Doku Umarov, head of the terrorist organization the Caucasus Emirate, called for attacks on the Winter Olympics and rescinded a directive banning attacks on civilians.
Jeffrey Mankoff, a fellow in the Russia and Eurasia program at the Center for Strategic International Studies in Washington, said that while the Caucasus Emirate generally focuses on Russia, it might be willing to accept international casualties during the Olympics.
“So many foreign participants at a high-profile event like the Olympics increases the likelihood of foreigners getting caught up in any successful attack, whether or not they are the intended victims,” Mankoff said in an e-mail.
Some U.S. Olympians have asked family to stay home. Speed skater Tucker Fredricks told his family not to attend because the security concerns would be a distraction, ABC News reported, citing interviews with his parents. Hockey players Ryan Suter and Zach Parise, who play for the Minnesota Wild, also told their families to stay away, according to the Star Tribune of Minneapolis.
IOC President Thomas Bach said Jan. 22 that organizers are confident the games will be safe.
“Security is always a matter of concern, not only at an Olympic Games but at every big event,” Bach told reporters in Rio de Janeiro. “We know the Russian authorities together with their many partners internationally are doing everything to organize the games in a safe and secure way.”
Dmitry Feld, a former luge racer from the Ukraine who now works for USA Luge as its marketing and sponsorship director, said he wasn’t worried about terrorism as he prepared to lead a pre-Olympic tour in Russia. Feld, 58, will escort 24 people to Moscow for three days before the Feb. 7 opening ceremony. None of his guests backed out of the trip after the alert was issued, he said.
“When the Olympics come it shows that Russia is trying to enter the modern world and become friends with the United States,” Feld said in a telephone interview. “In a lot of ways we treat Russia as this mysterious big Russian bear who might bite us without really trying to understand what it’s really all about.”
Jason Berger, president of the National Association of Ticket Brokers, said the Sochi Olympics are “almost a non- event” and that there are now great deals on tickets, airfare and hotels in Sochi.
‘Lack of Turnout’
“In my almost three decades of selling Winter and Summer Games, I have yet to see this lack of turnout,” Berger, chief executive officer of AllShows.com of Rye, New York, said in an e-mail.
Visa issues and distance are likely to keep American travelers from making last-minute plans to attend the Olympics as they have in the past, according to Andy Dailey, chief strategy officer of Austin, Texas-based Ludus Tours, the official sponsor of USA Luge, USA Curling, US Bobsled & Skeleton and the Canadian Curling Team.
“I don’t think many people are going to see this Russian destination they’ve never heard of in the opening ceremonies on TV in the dead of winter and say, ‘You know, that’s where I want to go next weekend,’” Dailey said.