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Business

Higher overseas hotel rates lifting costs for Japanese travelers

TOKYO -- Japanese sightseers going abroad will likely face higher costs for bundled deals this spring and summer as travel agencies seek to pass on the impact of the weaker yen and rising hotel rates.

     JTB will charge an average 8% more for its Look JTB packages departing from greater Tokyo. The increases will come to 7% and 5% for Europe and Hawaii, respectively, where the firm says hotel room rates are climbing amid an influx of tourists from China and other emerging countries.

     The cost of JTB packages to China is set to jump 15%. But this is because the firm has added more long trips to such faraway destinations as Tibet amid concern among Japanese consumers about pollution in the country and the geopolitical tensions between Tokyo and Beijing.

     Hankyu Travel plans a 10% hike for Europe and 5-10% increases for U.S. and Asian destinations. ANA Sales and Jalpak will lift prices by an average of 9% and close to 10%, respectively.

     Japanese travel agencies divide the year into April-September and October-March terms when planning overseas packages. Prices have been trending up after bottoming out in fiscal 2011, with the current half seeing a 5-10% uptick. Now, due to the weaker yen and rising hotel rates, prices will go up even further starting in April.

     Despite the price hikes, demand remains strong, says JTB, which sees sales climbing 3% in the year to March. "With consumer sentiment upbeat and seniors eager to travel, the impact of price increases will be limited" next fiscal year, says the firm, which expects 1.45 million people to go on its bundled tours in fiscal 2014, up 8%.

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