The first quarter of 2010 was the first time Accor has seen growth in its hotel business since the third quarter of 2008.
But while its economy hotels shielded the company from the worst of the recession they are now lagging during the upturn in comparison to its mid scale and upscale properties.
The good news is that Europe is recovering at the same speed as the US and economy hotels in Europe are much stronger than in the US. Excluding the US, revenue at Accor's economy hotels were up 2.7% in the first quarter. This compares to the 2.8% rise in like-for-like revenue growth for up and midscale hotels.
The big winners in Europe for up and midscale were the UK with a 10.2% revpar rise and 3.9% revenue rise and Germany with up 7.7% for revpar and 3.8% for revenue. (Accor excluded the impact of sales tax on these figures, changes in Germany actually took the numbers negative in that country.)
By contrast, Accor's comparatively weak position in the UK economy segment meant Germany was the stronger performing of the three major countries.
The economy hotels in the US are more problematic and Accor said the recovery there is far from setting in with revenue down 7.5% in the first quarter. The US economy hotels were lagging their up and midscale counterparts in the US by three to six months.
Even worse than the US, however, is Spain, where revpar was down 12.2% in the quarter against the 6.9% drop in the US.
Accor confirmed that it was continuing with its divestment programme. It sold the Sofitel in Washington DC for $95m to LaSalle Hotel Properties during the period. And it is continuing to look at the possibilities of divesting its 49% stake in casino operator Lucien Barriere.
HA Perspective: Accor described the hotel industry as "late cyclical". When general industry started to rebuild its inventories in the summer of 2009 it has taken six to nine months for this impact to feed through into increased room sales.
The impact is most pronounced in up and midscale properties which are more dependent on business travellers. For Accor, which is the dominant economy player in Europe, this is obviously less beneficial.
Perhaps the most interesting point of Accor's conference call on the sales numbers was its insistence that it would maintain a relatively flat pricing structure for its economy hotels. While the two dominant UK economy hoteliers – Premier Inn and Travelodge – are switching or have switched to a variable pricing strategy, Accor believes that a comparatively fixed price approach is a key part of the appeal of economy hotels.