Skift Daily Travel Briefing

Ask Skift Is the AI Chatbot for the Travel Industry: Ask Skift Your Questions Episode NotesThe Texas state government has filed a lawsuit against Booking Holdings, alleging the company violates state law by not including certain fees when it initially displays room prices, reports Executive Editor Dennis Schaal.Schaal writes the Texas lawsuit comes as the Biden administration and Congress are increasingly taking aim at so-called junk fees, charges that aren’t disclosed to consumers upfront. The lawsuit includes Booking Holdings and its sub-brands, Booking.com and Kayak, and refers to so-called resort fees and other extras.Texas Attorney General Ken Paxton said while announcing the lawsuit that the state had recently sued Hilton and Hyatt for allegedly deceptively displaying their fees. Next, experiences and major tourist attractions have become significantly more expensive in the past four years, writes Travel Experiences Reporter Selene Brophy. Analysis from marketplaces GetYourGuide and TicketLens revealed prices from tours and admissions tickets globally rose on average 18% between June 2019 and June 2023. Charmaine Chua, GetYourGuide’s head of optimization, attributed the jump to factors such as tourism’s rebound and a shift in consumer spending toward experiences. TicketLens found that Turkey recorded the largest price increase for experiences globally, with a 35% jump from 2019. Meanwhile, Miami registered the biggest price hike at 27% for local tourism attractions in the U.S. Finally, major hotels and online travel agencies have benefitted from an enormous surge in travel demand in Asia and Europe in the first half of this year, reports Senior Research Analyst Pranavi Agarwal.Agarwal writes the strength in global demand has now shifted to Europe and Asia. She writes companies initially hurt by their exposure to Asia are now reaping the rewards as its rebound takes hold. Agarwal cites Accor as one example. The France-based hotel company, which derives about a third of its revenue from Asia and nearly half from Europe, saw its revenue jump 40% from last year. 

Ask Skift Is the AI Chatbot for the Travel Industry: Ask Skift Your QuestionsEpisode NotesTourism boards across the U.S. are increasingly supporting measures to get workers back into offices to help boost struggling downtowns, writes Global Tourism Reporter Dawit Habtemariam. Habtemariam notes the U.S. Travel Association strongly backs President Joe Biden’s push to have federal employees spend more time in the office. An executive at the organization said getting federal workers back into the office was critical to the success of U.S. cities. Habtemariam reports cities are losing billions due to workers spending more time working remotely and fewer days in the office.   Tourism bureaus are also taking steps to fill their offices. San Francisco Travel and LA Tourism, among others, have each required employees to head to the office several days a week. LA Tourism CEO Adam Burke said getting people back in office would help increase foot traffic in the city’s downtown. Meanwhile, NYC Tourism+Conventions plans to increase the number of days employees go to the office weekly this fall. Next, Trivago recently brought back commercials featuring ad pitchman, the Trivago Guy. However, it’s uncertain if he’ll be part of the company’s marketing efforts going forward, reports Executive Editor Dennis Schaal. Schaal writes that the Trivago Guy — played by Actor Tim Williams — was credited with helping make the company somewhat of a household name in North America. Trivago CEO Johannes Thomas said the company is trying to boost growth and taking a more experimental approach to its TV ads to help boost traveler engagement. Finally, the U.S. House of Representatives recently passed its version of a bill reauthorizing funding for the Federal Aviation Administration. Reporter Kristin Majcher explains five key issues the bill addresses.  Majcher writes, beyond funding the agency for five more years, the reauthorization is important because it includes provisions about consumer protections and airline safety. She adds that some of those provisions have proven controversial. In particular, the Regional Airline Association has supported a proposal to increase the maximum age for pilots from 65 to 67 while the Air Lines Pilots Association has come out against it. Majcher reports the Senate needs to finalize its own version of the bill and both houses need to work out any differences by September 30. If the House and Senate miss the deadline, Congress would have to approve an extension. 

Ask Skift Is the AI Chatbot for the Travel Industry: Ask Skift Your QuestionsEpisode NotesU.S. tourism businesses were heavily dependent on Chinese visitors pre-pandemic and now are looking elsewhere to replace billions in tourist spending, writes Global Tourism Reporter Dawit Habtemariam. Brand USA CEO Chris Thompson said Chinese visitors spent $35 billion in 2019, making them the largest tourism market in the U.S. in terms of spend.  So where are U.S. travel brands turning? NYC Tourism + Conventions CEO Fred Dixon cited Brazil as one market the city is focusing on. Meanwhile, LA Tourism CEO Adam Burke said his city is ramping up its marketing efforts in countries such as Australia, New Zealand and the United Kingdom.  Next, tour operator group TUI has posted its first post-pandemic net profit. However, the company’s overall performance for the year is expected to be impacted by extreme weather throughout Europe, writes Travel Experiences Reporter Selene Brophy.  TUI Group CEO Sebastian Ebel said on Wednesday that surging travel demand in its third quarter pushed its booking performance to a 6% gain. He added the company had seen a drop in bookings after recent wildfires in Greece’s Rhodes Island. Brophy reports an estimated 8,000 TUI customers were impacted by weather and wildlife disruptions. Although Ebel outlined several ways extreme weather could impact the travel industry and the company, including destinations with more moderate climates likely seeing a boom in popularity.    TUI Group reported revenue of $5.8 billion during the third quarter, a 19% jump from last year. Finally, luxury travel subscription brand Inspirato has had its share of struggles recently, including mounting losses and another round of layoffs. But the company does see a path back to profitability, writes Short-Term Rentals Reporter Srividya Kalyanaraman. Inspirato CEO Brent Handler announced a partnership on Wednesday with investment firm Capital One Ventures, in which Capital One would provide Inspirato a $25 million convertible note. In addition, Inspirato has reduced supply, removing 60 residences from its portfolio due to non-renewal and/or early terminations of leases. Handler expressed confidence the company’s efforts to cut costs will be successful and said it can be profitable even without growth.  

Ask Skift Is the AI Chatbot for the Travel Industry Ask Skift Your Questions Episode NotesChoice Hotels views its recent acquisition of Radisson Americas as an enormous success and it’s strongly considering making more deals, reports Senior Hospitality Editor Sean O’Neill.Choice CEO Patrick Pacious touted the benefits of the acquisition during Choice’s second quarter earnings call on Tuesday. As for future acquisition activity, Pacious said Choice is always looking for deals that could boost the return on investment for hotel owners and grow brands. He added that Choice sees opportunities to expand its portfolio outside of the United States.  Choice reported that its revenue per available room — an important hotel industry metric — increased 20% from the same period in 2019. The company also set a quarterly record for revenue. Next, the Chinese government is limiting overseas group travel for its citizens to certain destinations. Those restrictions are stunting the global travel industry’s recovery, writes Travel Experiences Reporter Selene Brophy. Chinese travelers can only take group tours to less than half of the countries that were available to them pre-Covid. Brophy reports the U.S. is not on that list as Chinese travel agencies aren’t permitted to sell any group tour products to the U.S. Sienna Parulis-Cook, an executive at China-based marketing company Dragon Trail International, said Chinese outbound tourism to the U.S. is also limited in part because of visa delays. Chinese travel agents surveyed said visa delays were the biggest obstacle in selling outbound tourism in 2024. Chinese outbound travel hit 65% of 2019 level during the country’s most recent national holiday period. Finally, Turkish Airlines and Thai Airways have unveiled a plan to form a joint venturecovering flights between Europe and the Asia-Pacific region, reports Jay Shabat, senior analyst at Skift publication Airline Weekly. The two carriers already have a codeshare arrangement, which enables them to market each other’s flights. But Shabat notes joint ventures go deeper, often involving revenue sharing, collaborating pricing and cargo cooperation among other practices. Turkish and Thai haven’t yet detailed their exact plans, other than announcing that Thai will start serving Istanbul in December. 

Episode NotesThe U.S. expects visitor numbers from some major markets such as Canada and India to exceed pre-Covid levels this year. However, Brand USA CEO Chris Thompson says that progress won’t be enough to make up for the large-scale absence of Chinese visitors, writes Global Tourism Reporter Dawit Habtemariam. Thompson said in an interview with Skift that the U.S. won’t experience a full tourism recovery unless it attracts more Chinese tourists. China represented the U.S.’ largest tourism market prior to the pandemic. Thompson said Beijing’s refusal to lift the ban on overseas group travel for its citizens has impacted visitor numbers to the U.S. He added that West Coast destinations such as Los Angeles have been hit hard by the absence of Chinese travelers. Thompson also touched on what Brand USA is doing with the $250 million it received in federal funds to help boost international tourism. The organization used the funding to launch “This Is Where It’s At,” its largest ever single consumer campaign. It’s running in 10 out of Brand USA’s 11 markets, with the exception of China.  Next, a newly published financial report said that the Expedia Group may be showing resilience against rival Booking.com in the U.S., reports Executive Editor Dennis Schaal.  An analysis from global financial services firm BTIG listed reasons why Expedia Group may have blunted Booking.com’s market share gains. Schaal writes Expedia likely saw a faster increase in room nights than Booking.com. He adds that signs suggest that Expedia outperformed Booking.com in the U.S. He notes that’s important because Booking Holdings sees the U.S. as a relatively untapped market where it has ample room to grow. BTIG estimated that 60% of the Expedia Group presence is centered in the U.S. Finally, artificial intelligence has fundamentally altered the travel industry in recent years. Associate Editor Rashaad Jorden explains how, using answers provided by Ask Skift, our artificial intelligence chatbot. Ask Skift listed four areas where AI has significantly impacted travel, including predicting travel demand and providing personalized customer service. One travel executive said AI will likely uncover signals about travel demand from unlikely sources of information. In addition, Jorden reports travel brands are using AI to customize travel itineraries, enabling them to increase customer loyalty. Amazon Web has already used AI to make personalized recommendations for travelers, including suggesting hotels that matched their interests. 

Episode NotesIt’s still uncertain when business travel will make a full recovery. But Hyatt is optimistic that the sector is making substantial progress in its rebound from the pandemic, reports Senior Hospitality Editor Sean O’Neill.Hyatt CEO Mark Hoplamazian said on Thursday the company is seeing sustained corporate demand for group travel, which he added is showing no signs of slowing down. Hyatt booked roughly $500 million in future group business in the second quarter, and 42% of those group business were corporate. O’Neill writes that Hyatt’s more than 1,200 hotels and resorts are popular places to hold events, noting that corporate travel managers have reason to be encouraged about Hyatt’s upbeat report. Hyatt generated a net income of $68 million during the second quarter. The company’s revenue per available room — an important industry metric — rose 15% from last year. Next, the Lufthansa Group has lifted its profit outlook for the rest of the year due to robust travel demand in Europe, reports Edward Russell, editor of Airline Weekly, a Skift travel brand.CEO Carsten Spohr said on Thursday that the company has seen travel demand remain extraordinarily strong. Russell writes the Lufthansa Group has been boosted by premium leisure travelers who have become increasingly important to major airlines. He adds that people are still willing to pony up for travel within Europe and long-haul international routes.In addition, although corporate travel has plateaued at passenger volumes roughly 60% of 2019 levels, Spohr expressed optimism about the sector’s outlook for the fall. Finally, Airbnb believes its formula to continued growth includes providing better value than hotels and expanding throughout Europe, Latin America and Asia, reports Executive Editor Dennis Schaal. CEO Brian Chesky told analysts on Thursday that he heard last year that Airbnb was becoming less affordable compared to hotels. However, the short-term rental giant saw its rates rise 1% globally in the second quarter while the hotel industry saw an up to 10% jump. The company unveiled new pricing tools for hosts several months ago, which Chesky said will help make Airbnb stays more affordable for guests. Schaal notes that Airbnb saw bookings significantly rise in both Brazil and Germany during the second quarter. Chesky said Airbnb would apply the lessons it’s learned from those two fast growing markets to its global expansion strategy, especially in Asia. However, he said Airbnb isn’t planning to re-enter Mainland China, which the company withdrew from in 2022. 

Ask Skift Is the AI Chatbot for the Travel Industry: Ask Skift Your Questions Episode NotesTrivago opted not to join the advertising unit that Google launched in May to attract hotel bookings. That decision contributed to the online travel agency’s disappointing second quarter performance, reports Executive Editor Dennis Schaal.  Schaal writes that Trivago’s absence in the new unit — unlike rivals such as Booking.com, Priceline and Expedia — negatively impacted its second quarter financial results. Trivago’s revenue fell 14% from the previous year. Trivago Chief Financial Officer Matthias Tillmann said on Wednesday it decided not to participate in Google’s property promotions ads because they are a part of Google hotel ads, which don’t perform well for Trivago.  Next, the chief technology officer of travel technology firm Sabre stepped down last month, a departure that coincides with other major job cuts and changes in leadership, writes Travel Technology Reporter Justin Dawes. Dawes reported that David Moore left Sabre last month after seven years with the company. The change comes as Sabre continues its biggest tech transformation ever, namely its transition to Google Cloud, which is expected to be completed by the beginning of 2025. Finally, Allegiant Air successfully rode its strategy of mostly flying on specific days[Access for Skift Pro and Airline Weekly subscribers only] and to its most popular destinations to a strong second quarter, reports Edward Russell, editor of Airline Weekly, a Skift publication. The Las Vegas-based discount carrier saw revenue increase 9% in the second quarter from last year. It also reported a $133 million operating profit. Russell writes Allegiant is unique among U.S. airlines in that it typically only flies on peak days, an approach that has helped it profitably serve many U.S. smaller and medium-sized cities. Russell adds that Allegiant’s rivals are taking steps to emulate its success. Southwest, Frontier and JetBlue have all unveiled plans to reduce flying on off-peak days. 

Ask Skift Is the AI Chatbot for the Travel Industry: Ask Skift Your Questions Episode NotesThe solid performance of Marriott’s premium hotels drove the world’s largest hotel company to a strong second quarter. And now, Marriott is looking to add midscale hotels to its portfolio, reports Senior Hospitality Editor Sean O’Neill.O’Neill writes one reason Marriott has raised its 2023 outlook for profitability was that its hotels are mostly premium or above. He adds that travelers able to afford Marriott stays were largely sheltered from the economic concerns hitting the general population. Marriott’s revenue per available room — a key hotel industry figure — rose roughly 13% in the second quarter from last year. Marriott has also taken steps to boost its number of midscale hotels, with CEO Anthony Capuano indicating that Marriott would make a midscale push in Europe. O’Neill writes one factor driving Marriott’s interest in the sector is that midscale properties are popular with developers, investors and owners. Midscale hotels tend to be fancier than economy hotels while still being considered affordable. Next, the Biden administration has repeatedly taken aim at so-called junk fees, charges that aren’t disclosed to consumers upfront. So what should the travel companies do? Give in. That’s the message from Skift CEO and founder Rafat Ali in an open letter to the travel industry. Ali argues that companies need to acknowledge that it’s a real issue and tackle it head on and. In most cases, that will mean being more transparent. In some cases, getting rid of certain fees. Ali adds that there’s bipartisan agreement in Washington, D.C. on the cracking down on junk fees and that consumer sentiment is 100% with it. Finally, India’s newest carrier Akasa Air has added an 20th aircraft to its fleet, making it eligible to fly internationally, writes Middle East and Asia Reporter Amrita Ghosh.Akasa Air CEO and founder Vinay Dube hailed the milestone as a major sign of the potential of India’s aviation industry. Ghosh notes that Indian regulations require airlines to have at least 20 aircraft in their fleet to be eligible for international operations. Dube has said Akasa Air, which launched last year, is looking to fly to the Middle East, Southeast Asia and Eastern Africa among other regions. 

Episode NotesSoccer’s World Cup is coming to North America in 2026, but it’s uncertain where the final of the tournament will be held. Three U.S. cities are jockeying to host the event’s most prestigious match, writes Global Tourism Reporter Dawit Habtemariam. Habtemariam writes that Dallas, Los Angeles and MetLife Stadium in New York City’s New Jersey suburbs are prime contenders to host the final. FIFA, soccer’s international governing body, is expected to announce in September which city will host the match. Travel executives from each city laid out reasons why their city should be chosen. NYC Tourism+Conventions CEO Fred Dixon cited New York City’s passion for soccer as one reason it should host the World Cup final.Next, the lengthy visa processing times have inhibited U.S. destination marketers’ ability to attract tourists from crucial international markets, writes Global Tourism Reporter Habtemariam.The average wait time for a U.S. embassy interview for a first-time visitor visa applicant in countries such as India, Brazil and China exceeds 400 days on average, according to the U.S. Travel Association. LA Tourism CEO Adam Burke said those long waits are the biggest issue facing the U.S. tourism industry. NYC Tourism+Conventions CEO Dixon said the city needs to attract travelers who need visas in order to boost tourism. Habtemariam notes there are large numbers of travelers with valid visitor visas in many key tourism markets. Burke said there are roughly 5 million people in India with a valid 10-year visa, and Dixon stated there’s a good base of business coming from that segment of travelers. A 2023 Skift Megatrend examined the impact of visa processing delays on the travel industry’s recovery. Finally, as international travel continues to recover from the pandemic, Associate Editor Rashaad Jorden turns to Ask Skift, our artificial intelligence chatbot, to find out what’s the world’s largest outbound travel market.Ask Skift revealed the answer is India, which overtook China as the world’s most populous nation in April of this year. India’s travel industry has been boosted by a growing middle class increasingly eager to venture overseas. India generated Asia’s highest outbound travel volume for the first time in 2022. In addition, international leisure flight bookings from India have jumped 40% for trips between June and August, compared to last year, according to travel software company RateGain. 

Episode NotesWyndham Hotels & Resorts reported a drop in profitability during the second quarter. That’s partly because the hot demand for its budget hotels is cooling, reports Senior Hospitality Editor Sean O’Neill. Wydham saw its net income fall 18% in the second quarter from last year. O’Neill writes its portfolio skews toward affordable roadside hotels, which surged in popularity immediately after the pandemic eased. Now, Chief Financial Officer Michele Allen said things are returning to normal. The company has also seen travel to big cities and international destinations rebound significantly.Meanwhile, Wyndham said it’s not worried about increased competition in the extended stay sector. The company launched its own extended stay brand last November in the U.S. and Canada. Extended stay has since emerged as one of the hottest categories in hotels, with Marriott, Hilton and Hyatt all addring brands. Next, Google executives had cited travel as a major source of revenue growth during the previous two quarters. However, the tech giant’s parent company Alphabet didn’t call out travel as a major priority this week, reports Executive Editor Dennis Schaal.Alphabet’s Chief Business Officer Philipp Schindler said that Google’s three main priority areas are artificial intelligence, retail and YouTube. Google had extensive layoffs at Google Flights earlier this year and recently replaced the head of Google Travel. Even so, Schaal writes Google surely still makes a lot of money from travel advertisers. And it announced in June that it had added some travel features to its AI-powered search experience. Finally, Royal Caribbean has raised its earning forecast this year by a third after a strong second quarter, writes Contributor Jess Wade.In addition to the increased earnings per share, the company said during its conference call on Thursday that consumer spending onboard is continuing to significantly surpass 2019 levels. A Royal Caribbean executive also pointed to “encouraging” bookings for its China cruises, which are expected to set sail in April 2024. Royal Caribbean recorded a net income of $459 million during the second quarter, in contrast to a loss the same period last year.