Hotels, restaurants and the shops will be slashing their prices in deals aimed at attracting tourists for the difficult autumn and winter season, it was revealed yesterday.

Hotels will be cutting their rates even further than normal for November and December, even if it means losing money, to encourage visitors to come to the Island, said Bermuda Alliance for Tourism (BAT) co-chair Judith Hall Bean yesterday.

"Communication with providers of services and activities in Bermuda is underway with a view to having them join with the hotels in offering reduced prices for the services they offer," she said.

"We are hoping that such reductions may be Islandwide and will include transportation, retail, restaurants, as well as related activities."

But the cut price deals - which are still being worked out through the public/private sector BAT - will be being targeted at tourists not locals, said BAT co-chair William (Billy) Griffith.

But he said hotels will be offering on-Island promotions to encourage residents to eat out and stay overnight to fill up the empty beds.

"We are trying to attract business from overseas, so there will be separate promotions with some kind of passport and probably discounts to restaurants. How the other entities, the shops and hotels, market to locals will be different."

When asked if the restaurants and retail sectors are committed to such a plan, Mr. Griffith said: "They will be. There are several hotels already committed to discounts and we are working feverishly with the Bermuda Experience network and on-Island activities and we will have a solid promotional programme that will be in place when the timing is right."

Tourism Minister David Allen has already announced that a planned marketing campaign in the United States has been suspended because Americans are not ready to travel in the immediate wake of the terrorist attacks in New York and Washington, but a new enhanced resort promotion will go ahead probably next month.

Despite Transport Minister Dr. Ewart Brown warning on Monday that three out of four US airlines which service Bermuda could go out of business before the end of the year and US Airways cancelling its flight from Baltimore, Mr. Griffith said he was confident the airlines will continue to fly to Bermuda. Dr. Brown's statement was made before President George W. Bush had confirmed a multi-billion dollar rescue package for the airlines, and Mr. Griffith said America was gripped with a nationalistic desire to keep the airlines in business.

"If they go out of business, we will be in a difficulty, but Bermuda is a reasonable and attractive destination for any airline that wants to fly," said Mr. Griffith, who is also president of Bermuda Hotel Association (BHA).

Government is hoping to meet British Airways executives in London to lobby them to drop prices and possibly increase flights. There may even be potential for other European airlines to fly to Bermuda in the short-term if there is more business from the continent, said Mrs. Hall Bean. Government is also encouraging international businesses to suggest to colleagues that cancelled meetings and conferences could be held on the Island because it is so safe.

Mr. Allen said there was the potential for Bermuda to pick up group business if companies and groups, particularly from the US, want to meet somewhere closer to home than normal.

All hotels have been forced to lay-off staff as occupancy rates have slumped to around 20 percent, Mr. Griffith confirmed.

But apart from two hotels - Ariel Sands which will close in January and February for restaurant renovation and the Newstead, which has said it could even close in the worst case scenario - the BHA has not heard of any other hotels that had specific plans for closure or extended winter shutdown.

, said Mr. Griffith.

Mr. Allen said there were no plans to allow more cruise ships in next year to compensate for a possible loss in air arrivals.

He said he did not want to upset the balance agreed by BAT to keep cruise ship numbers are around 200,000.