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News ~
Snapshot
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ECONOMIC INSIGHTS---
PwC SAYS
LODGING WILL SEE 25% INCREASE IN PROFITS IN 2005
PricewaterhouseCoopers says the lodging industry will
experience a 29.9 percent increase in profits in 2004
to $16.6 billion, a 25 percent increase in profits in
2005 to $20.8 billion in 2005 and record profits of
$25.2 billion in 2006. "In 2004, for the first
time since 2000, the lodging industry experienced an
increase in total industry profits (income before income
taxes). Profits declined in 2001 to $16.8 billion from
a high of $22.5 billion in 2000 (based on data from
Smith Travel Research). The dramatic increase of 7.5
percent for RevPAR in 2004 and increases of 7.3 percent
in 2005 and 6.3 percent in 2006 (based on PwC estimates)
will translate to record high profits by 2006,"
says Bjorn Hanson, Ph.D., Global Industry Leader of
PricewaterhouseCoopers Hospitality & Leisure Practice.
Profit per available room will increase 28.7 percent
from prior-year in 2004 to $3,728, another 23 percent
from prior-year in 2005 to $4,585 and then 18.6 percent
from prior-year in 2006 to $5,440 surpassing 2000 levels.
- ehotelier.com
LODGING
SUMMIT RAISES OPTIMISM FOR HOTEL INDUSTRY
This year's Americas Lodging Investment Summit reinforced
the notion that it is a good time to invest in hotels.
Nowhere was this more evident than in the opening session
entitled "The Economic And Performance Outlook:
The Facts And What They Mean." Bjorn Hanson, global
industry leader, hospitality & leisure, PricewaterhouseCoopers,
forecast demand growth 4.1% in 2005. In addition, he
also indicated that 2006 is expected to generate $25.2
billion in profitability for the industry, a new record.
Meanwhile, Randall Smith, CEO of Smith Travel Research
noted "we do expect to see room rates increasing
more than occupancies." He also added that "supply
seems to be under control." - Hotel Business
TIA'S
TRAVELER SENTIMENT INDEX FALLS IN 4th QUARTER 2004
The Travel Industry Association of America's (TIA) quarterly
Traveler Sentiment Index showed a moderate decline in
fourth quarter 2004, falling 3.2 percent to 95.8 from
third quarter 2004. Consumers were most concerned about
their ability to take a pleasure trip based on their
personal finances and available free time. They were
also slightly less interested in taking pleasure trips
and were somewhat negative about the affordability of
pleasure travel compared to third quarter 2004. The
only index remaining unchanged was traveler perceptions
of service received while traveling. - eHotelier.com
»
HSMAI TSUNAMI/TOURISM RESOURCE CENTER
Visit this In depth section to learn more about the impact
as well as background articles, images and video coverage.
Visit this Member's Only resource which is being constantly
updated.
---
HOTEL HIGHLIGHTS---
STARWOOD
TO OPEN ITS 30TH PROPERTY IN CHINA
Starwood Hotels & Resorts Worldwide announced
an agreement to manage the 330-room Sheraton Chongqing
Hotel in China. The hotel, set to open January 2008,
will be in the new entertainment and commercial district
of Chonging on Nanbin Road. It is part of the "Chongqing
Bund" development in the city. The hotel is part
of a mixed-use complex that houses the hotel, convention
hall, prime office and retail spaces and will be the
tallest building in Chongqing when completed.
DOUBLETREE
TO ADD 15 PROPERTIES THIS YEAR, 200 BY 2008
Doubletree Hotels said 15 hotels are scheduled
to join the brand's current collection of more than
150 full-service properties in 2005, and will boost
its hotel portfolio by more than 25 percent to 200 full-service
hotels throughout North America and Latin America by
2008. Doubletree said it added six new hotels and resorts
between September 2004 and January 2005. About 25 Doubletree
deals are in various stages of planning and/or development.
MARRIOTT
OFFERS FREE IN-ROOM FITNESS EQUIPMENT
Marriott has kicked off its new complimentary
in-room fitness program, "Great Health - Fit For
You." Guests can choose from three different equipment
options: the BodyRev, Michael Sena's Traveling Trainer
kit and the BodyWedge 21. All three companies have partnered
exclusively with Marriott, which is rolling out the
equipment at Marriott and Renaissance hotels in North
America this month. Fit For You also has a culinary
component, which was initially a healthy breakfast option.
The program has been expanded to all food and beverage
outlets, including room service, and is divided into
carb-conscious, low-fat and low-cholesterol categories.
- Travel Agent Magazine
HILTON
TO SELL MUCH OF ITS OWNED PORTFOLIO
During the Americas Lodging Investment Summit,
Matt Hart, president of Hilton Hotels Corp., revealed
during a panel that the U.S. chain will be selling a
good deal of its owned portfolio- not the "Crown
Jewels." Several packages will shortly be on the
market, according to Hart. And during the conference,
the Plasencia Group reportedly has been showing at least
one of the packages to prospective buyers. - Hotel Business
MICROTEL
GAINS ATTRIBUTED TO TRAVELERS WITH DISABILITIES
Microtel Inns & Suites, the all- newly
constructed chain of budget/economy hotels, reported
sharp gains in its 2004 bookings for ADA room nights
across all distribution channels by nearly 275% over
the previous year. In addition, net revenues for ADA
room nights increased by more than 260%. Internet bookings
for ADA rooms during the same period marked the strongest
gains, with an increase of more than 400%, followed
by bookings on the Global Distribution System (GDS),
which increased by more than 360%.
NY PLAZA
HOTEL TO BECOME CONDO, SMALL HOTEL, RETAIL SPACE
New York's 805-room Plaza Hotel will close
its doors April 30 and will be transformed into a combination
of upscale condominiums, stores and a much smaller,
150-room hotel. Expected to reopen late 2006, the property
should house 200 condominiums and multi-level retail
space in addition to the hotel rooms, which will be
located in the building's 58th St. side. The condos
will be built on the top 12 floors of the 19 story Plaza
building, as well as on some of the lower floors facing
Central Park, according to reports. Some of the hotel's
famous restaurants, including the Oak Room, Oak Bar,
and Palm Court will reopen but could have new names
and new menus. The Oyster Bar will be converted into
retail space, reports said. The main ballroom will remain
unchanged. - Hotel Business
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AIR TRAVEL TRENDS---
UNITED
URGES AGENCIES TO USE ALTERNATIVE GDSs
United recently conducted a meeting with some
40 agencies and 30 corporate accounts, urging them to
explore use of start-up alternative GDSs, including
G2 Switchworks, ITA Software and FareLogix. United said
it was considering paying early adopters of the GNEs
(GDS new entrants) inducements of around $5 per ticket
to replace lost incentives if agencies and corporations
move some of their volume to the start-ups. United stated
that the inducements would be temporary, ending when
some 20% of United's volumes were going through the
low-cost start-ups.
AMERICAN
WILL SELL FOOD ON SOME DOMESTIC FLIGHTS
American will begin selling $3 snack boxes
and $5 sandwiches in the main cabin of about 600 select
domestic flights on Feb. 1. It will allow passengers
to purchase the food on flights of more than three hours.
American said it will save about $30 million a year
under the program.
ARC REPORTS
7% GAIN IN AIRLINE SALES FOR 2004
The Airlines Reporting Corp. (ARC) reported
healthy numbers for the end of 2004 and the year as
a whole. Total sales settled through ARC were slightly
less than $66 billion, the company said-a 7 percent
increase over 2003 and the highest year-end result since
2001. According to ARC, that result is attributable
to consistent growth in international fares, which completed
the year up 19 percent. In addition, ARC said, there
was a 5 percent growth in transactions, and average
weekly sales per location for the year as a whole exceeded
$50,000 for the first time in 2004. For December 2004,
transactions were 9 percent over December 2003. - Travel
Agent Magazine
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INTERNATIONAL INFO---
CHINA TOURISM
SETS RECORD WITH 109 MILLION VISITORS
The inbound tourists to the Chinese mainland
reached 109.04 million in 2004, breaking the 100 million
mark for the first time. This earned the foreign exchange
revenue up to 25.7 billion U.S. dollars, according to
statistics released by the National Bureau of Statistics
and the China National Tourism Administration. The inbound
tourists mainly came from the 16 countries of Japan,
the Republic of Korea, Russia, the United States, the
Philippines, Malaysia, Mongolia, Singapore, United Kingdom,
Thailand, Australia, Canada, Germany, Indonesia, India
and France. The number of visitor arrivals from these
countries saw remarkable growth in 2004 over the previous
year. The outbound tourists from the Chinese mainland
amounted to 28.85 million in 2004. Some 5.87 million
Chinese mainland people traveled abroad for business
purpose, up 8.55 percent compared with last year. -
eHotelier.com
CZECH
REPUBLIC BECOMES HOT TOURIST DESTINATION
World travelers take notice -- the Czech Republic
is a hot destination right now. Tourism is expected
to have grown globally by 4 percent in 2004, but it
increased 15 percent and is expected to climb another
10 percent this year, according to data from Czech Tourism.
New airline routes are making it easier for people from
a wide range of countries to reach the Czech Republic
and the government is taking steps to keep tourism a
thriving industry. Over 7 million tourists visited the
country in 2004. Revenue from tourism accounts for 4.2
percent of the country's gross domestic product. Germans,
Americans and Britons comprise the majority of tourists
visiting the Czech Republic. - ehotelier.com
TURKEY
EXPERIENCES REVIVAL OF TOURISM
Turkey's Minister of Culture & Tourism
Erkan Mumcu set a goal of 20 million tourist arrivals
for 2005. Some 17.5 million visitors arrived in Turkey
in 2004, including about 300,000 Americans, a 32-percent
increase over 2003. About 50 percent of Turkey's visitors
come via cruise ships stopping in Istanbul and Kusadasi
(Ephesus). Says Mumcu: "We think it's incredible
that we are seeing increases such as this from the U.S.
even as the war is going on in Iraq." In the past,
activity in the Persian Gulf has been a detriment to
Turkish tourism; Turkey's border with Iraq is far from
any of the destinations that are popular with American
tourists. - Travel Agent Magazine
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BIZ/LEISURE TRAVEL---
BUSINESS
GROUP TRAVEL SEEN BOOSTING HOTELS IN 2005
Travel demand by business groups, if not convention
business, is expected to pick up speed this year, driving
U.S. hotel revenue and profits higher, according to
hotel executives attending a lodging conference recently.
"Group sales are typically slower to recover than
other segments, but we are seeing that now," said
Douglas Geoga, president of Hyatt Corp. Since the Sept.
11 attacks of 2001, the leisure traveler has been the
foundation of hotel occupancy in the United States.
Joseph McInerney, chief executive of the American Hotel
& Lodging Association said: "Now, hotels are
starting to sell out Monday through Thursday and demand
for weekends is strong," as people continue to
take shorter vacations. Big hotel chains say the trend
is enabling them to raise prices. There is a perception,
however, that a recovery in convention business remains
elusive.
GROUP,
BUSINESS TRAVEL FUELED 2004 LODGING RECOVERY
Group and transient business travel drove
the rebound in U.S. lodging last year, according to
a report released by industry tracker Smith Travel Research.
"Good growth in group demand helped fuel the industry's
gains," said Mark Lomanno, the firm's president.
"Also, mid-week performance improved, likely a
result of increased business travel." Lomanno added
that "industry operating performance was very good
in 2004." Occupancy nationwide rose 3.7 percent
last year over 2003, to 61.3 percent; average room rates
increased 4 percent, to $86.41; and revenue per available
room, or RevPAR, a key measure of industry productivity,
gained 7.8 percent, to $52.93. RevPAR gains were greatest
in the top 25 markets, destinations that draw the vast
majority of large meetings, conventions and trade shows
as well as a disproportionate percentage of transient
business travelers. - Successful Meetings
TECHNOLOGY
CAUSES SHIFT IN BUSINESS TRAVEL PATTERNS
Technology has caused the business travel
landscape to shift, according to a new
report from the Travel Industry Association of America
(TIA), the National Business Travel Association (NBTA)
and the Institute of Business Travel Management. "Business
travel has been one of the most seriously affected by
the events of recent years and the slowest to recover,"
said Dr. Suzanne Cook, senior vice president of research
for TIA. "We believe that this reflects some of
the changes that American businesses and business travelers
themselves have made in recent years to enhance the
efficiency of both the time and money they spend - changes
that are still evolving." Improvements in technology
have also altered the business travel landscape, creating
greater acceptance of online business communication
technologies as an alternative to travel. Nearly 40
percent of all business air travelers were substituting
technology, increasingly web conferencing, for some
travel in 2004, although this is down from 47 percent
reporting the same in 2002. Nearly three-quarters (71%)
of all business air travelers in 2004 felt that the
use of teleconferencing, webcasting or videoconferencing
was somewhat or much more efficient than travel, up
from 65 percent in 2002. However, only 37 percent of
business air travelers feel that using such technology
is more effective than a face-to-face meeting as a way
of meeting business goals.
---
CRUISE NEWS---
CRUISE
LINES PREDICT 11.1 MILLION CRUISERS IN 2005, UP 4.6%
The Cruise Lines International Association
(CLIA) is estimating that 11.1 million people will take
a cruise in 2005, up about 4.6% from the projected 2004
figures. The annual bump will be a little smaller than
last year's, simply because there's not that much tonnage
coming on line: Only three new ships will be delivered
this year. Occupancies, meanwhile, are expected to remain
high. CLIA expects that 2004 load factors were about
105%, which is what they predict for 2005, too. - Travel
Weekly
---
ONLINE ISSUES ---
SOME AIRLINES
GET MORE BOOKING ONLINE THAN OFFLINE
Delta Air Lines said half of its bookings
are being processed online through a mix of direct and
third-party channels. Specifically, during the first
two weeks of the year, delta.com handled 29 percent
of all bookings and online travel agencies handled 21
percent, up 9 points and 8 points, respectively, year-over-year.
A Delta spokesperson said the airline's recent pricing
redesign has produced "a substantial increase"
in migration from offline channels, such as traditional
travel agencies, to online distribution outlets. Other
airlines also report growing usage of their Web sites
and such online booking options as Expedia, Orbitz and
Travelocity. Northwest Airlines, for example, said Internet
channels now represent 37 percent of all U.S. point-of-sale
bookings. A US Airways spokesperson said traditional
travel agencies still account for more than half of
total bookings on that carrier, but volume on usairways.com
has grown noticeably during the past year and now accounts
for 20 percent of all bookings. Long a leader in encouraging
direct online bookings, Southwest Airlines now generates
63 percent of total passenger revenues through its Web
site. - Hotel Marketing.com
AMERICAN
LOADS SOME WEB-ONLY FARES IN AMADEUS
American put its Web fares in Amadeus for
flights sold in the U.S., Canada, Puerto Rico and the
U.S. Virgin Islands. American agreed to give Amadeus
subscribes in the U.S. and Canada access to the same
publicly available fares that the airline offers through
its internal res systems, its Web site and third-party
sites, Amadeus said. Amadeus didn't detail the terms
of the agreement, but tied the deal to its value-based
GDS pricing scheme. - Travel Weekly
KAYAK.COM
DEBUTS ON THE WEB
Kayak.com launched its travel-search engine
with Orbitz as a participant and with a presence on
CNN.com. The system offers air and hotel bookings by
routing consumers to supplier and agency Web sites.
The rental car section, still in development, will display
advertisements from car rental companies and agencies.
Kayak's site is designed for PCs only and doesn't support
Apple Macintosh computers. -- Travel Weekly
HOTELS.COM
LAUNCHES VACATIONSPOT.COM FOR CONSUMERS
Hotels.com owns and is powering a new consumer
Web site that allows users to instantly book vacation
rental properties, such as suites, villas and homes.
Called VacationSpot.com, the site has thousands of rentals
around the world. The site offers pictures, ratings
and descriptions and low-price guarantees, says Dan
Proctor, vice president of vacation rentals.
The first-ever, all-encompassing, online
source for information, research, contacts and best
practices, eConnect is an HSMAI Foundation program hosted
by the University of Houston's Conrad N. Hilton College.
Go
to eConnect and access the exclusive HSMAI Member
Only areas. Watch for the new eConnect, coming in Mid-March,
2005, with enhanced and customized content.
---
ASSOCIATION NEWS---
HSMAI ANNOUNCES
NEW MEMBERSHIP CATEGORY: EXECUTIVE ELITE
The new HSMAI Executive Elite membership category
is limited to qualified senior executives in the hospitality
industry. Benefits include:
- Complimentary by invitation only
attendance at our 2005 Executive T.H.I.N.K. programs
- Choice of complimentary attendance
at one of our 2005 HSMAI Strategy Conferences on subjects
like Hotel Internet Marketing, Revenue Management,
Industry Trends, etc.
- Inclusion in our select mailing
list for our special industry white papers - like
the newest DeMystifying Distribution
- Monthly Executive Elite Update from
HSMAI CEO and the HSMAI Executive Board on relevant
industry subjects
- Quarterly distribution of HSMAI's
Marketing Review magazine
- Special web access to HSMAI Foundation's
eConnect research and information online repository
- Other special events and benefits
tailored to senior industry executives
Introductory price: $650.00 per year*
» Email mjorgensen@hsmai.org
for your personalized invitation and invoice or call
our Executive Vice President, Fran Brasseux, at 703-610-9024
for more information.
*Current members receive credit for
current membership dues when upgrading to the new Executive
Elite membership category.
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