Skift Daily Travel Briefing

Episode NotesChina was a major market for Carnival Corporation prior to the pandemic. But despite Beijing lifting the country’s strict travel curbs earlier this year, the cruise line isn’t returning to China in the near future, writes Global Tourism Reporter Dawit Habtemariam. Carnival CEO Josh Weinstein said on Monday the company’s strong second quarter did not reflect a return to China, and added the company would “be on the sidelines” for a few years. Roughly 1 million Carnival guests came from China in 2019. Meanwhile, Weinstein described the company’s onboard revenue as “off the charts.” Habtemariam reports more than a third of Carnival’s onboard revenue over the 12 months have been booked in advance. However, despite that higher consumer spending, the company’s shares fell 10 percent, after Carnival executives noted rising labor and fuel costs. Carnival Chief Financial Officer David Bernstein said the company incurred $13 million in higher fuel costs. Next, speaking of China, strong performance over the country’s most recent national holiday is a major sign international travel is rebounding, reports Asia Editor Peden Doma Bhutia. Bhutia writes China’s three-day Dragon Boat Festival holiday revealed a noticeable rebound in outbound travel. International border crossings during the holiday period hit 65 percent of 2019 levels, according to government officials. Bhutia notes that Hong Kong was the most popular destination for travelers living in Mainland China, with hotel bookings made by Mainland Chinese for Hong Kong trips recording a substantial increase from last year. China had the largest outbound travel market in the world before the pandemic, both in terms of number of trips and total spend. Finally, delays in Europe visitor visas are driving more Indian travelers to book trips closer to home, reports Asia Editor Bhutia and Middle East and Asia Reporter Amrita Ghosh.As one India-based travel executive admitted those delays are concerning to those looking to visit Europe, online travel company MakeMyTrip said Indian travelers are increasingly interested in Asian destinations. The company notes Thailand, Singapore and Malaysia are among the top five choices for Indian travelers. In addition, 92 percent of travelers expressed a desire to explore domestic destinations, according to a recent survey by budget hotel operator Oyo.

Episode NotesHong Kong-based carrier Cathay Pacific said on Friday it expects to turn a profit in the first half of 2023 after years of losses. But the company’s slow recovery is a concern in the airline industry, reports Edward Russell, editor of Airline Weekly, a Skift publication.Cathay Pacific’s expected profit comes after it posted a roughly $320 million dollar loss in the first half of last year. Russell writes Cathay Pacific was hit hard by the Hong Kong government’s strict Covid-era travel curbs, most of which were only lifted last December. Those restrictions severely limited Cathay Pacific, an airline with no domestic market to serve. Although Cathay Pacific has seen a surge in travel demand, Russell adds it still lags behind regional rival Singapore Airlines. He notes that Singapore Airlines used the pandemic to accelerate plans to streamline its operations while Cathay Pacific is still focused on rebuilding its network. Next, the U.S. has unveiled plans to open consulates in the Indian cities Bengaluru and Ahmedabad. U.S. officials believe those consulates could help expedite the visa application process for Indian travelers, writes Middle East and Asia Reporter Amrita Ghosh.Ghosh reports visa delays represent the single biggest impediment to growth in travel between the U.S. and India, with India emerging as the U.S.’ second-largest visitor source market outside of North America. U.S. lawmakers have urged the Biden administration to tackle the issue of lengthy visa wait times. There has been some improvement: Wait times for visitor visas at some U.S. consulates in India have recently decreased in half, from more than 600 days. Finally, the owners of the Spain-based Hotel Finca Cortesín have opened a new propertylocated inside a 17th century palace, reports Contributor Leslie Barrie.Barrie notes the Mallorca-based Gran Hotel Son Net is the second hotel venture from the team behind the Finca Cortesín. Finca Cortesín Hotels Managing Director Rene Zimmer is adamant the new property isn’t a boutique hotel or resort. But Zimmer said it will have plenty of local touches, including serving mostly Mallorcan wine and food grown on the island. Barrie writes the Gran Hotel Son Net’s staff believes its focus on local themes will resonate with guests. 

Episode NotesA growing number of affluent travelers are seeking extreme adventures, but are they pushing the boundaries for those popular excursions too far? Travel Experiences Reporter Selene Brophy seeks answers from executives responsible for organizing those trips. Carl Shephard, co-founder of travel company Insider Expeditions, said safety is always the priority, but added that the industry is providing valuable experiences. He said companies like his should push the boundaries. Virgin Galactic, a long-time Insider Expeditions client, recently took a group of 30 future astronauts on a trip to a remote island centered around a one-minute solar eclipse. Brophy notes she scheduled interviews for the story before the OceanGate submersible, the Titan, went missing while taking passengers to explore the Titanic wreck. The five passengers on board are believed to have died.Next, much of the discussion around artificial intelligence in travel has centered around how the technology can help increase bookings. But Travel Technology Reporter Justin Dawes reports in his Travel Tech Briefing that hotel tech startups are using AI to combat an ongoing labor shortage. Dawes cites HiJiffy as one tech company that’s gotten a boost from hotels struggling with staffing issues. Founder Tiago Araújo said the startup grew 150 percent during the pandemic due the industry-wide labor shortage, a challenge many hotels still face. The company said its so-called “pre-stay” product is able to quickly answer roughly 80 percent of guest questions about the hotel. Araújo added most of HiJiffy’s clients are doing well in terms of revenue. But he acknowledged many are having difficulties regarding staffing, which is driving them to automate as many processes as possible. We end today in Bhutan. The country is lowering its sustainable development fee — used to offset the carbon footprint of tourists — to encourage longer stays, reports Asia Editor Peden Doma Bhutia. Bhutia writes Bhutanese authorities relied on feedback from the country’s travel executives to develop options for longer stays. Garab Dorji, CEO of travel company Truly Bhutan, said the reduced fee will give tourists an opportunity to explore more of the country. Bhutan’s tourism department estimates the South Asian nation attracted roughly 52,000 tourists between late September 2022 and mid-May. Bhutia adds the country aims to hit pre-pandemic tourism figures by the end of 2024. 

Ask Skift Is the AI Chatbot for the Travel Industry. Ask Skift Your QuestionsEpisode NotesCanadian travel brands took on large amounts of debt during the pandemic to weather the Covid-induced slowdown. But with those companies still struggling due to the country’s sluggish recovery, Global Tourism Reporter Dawit Habtemariam writes Canada’s travel industry could face business shutdowns in the near future.   Tourism Industry Association of Canada CEO Beth Potter said a large number of travel companies are worried they’ll have to close up shop. A survey by the organization found nearly a third of businesses had more than $250,000 in outstanding debt. In addition, more than half of companies said they weren’t confident about making debt payments due in the next two years. Habtemariam notes a large portion of those debts are to the Canadian government, with the country’s businesses receiving loans from Ottawa to stay afloat during the pandemic. The tourism association is calling on the government to move payment deadlines, among other requests. About 45 percent of Canadian travel businesses said they could shut down within the next three years without government help. Next, a growing number of travel brands are turning to major sporting events to upsell and market their core services, writes Travel Experiences Reporter Selene Brophy.Mark McLaughlin, CEO of Dublin-based ticket distribution platform Coras, said travel companies can use sporting events to increase customer engagement. McLaughlin, whose company has partnered with some of Europe’s elite soccer clubs, added that fans visiting Barcelona consider going to a game as much of a bucket list item as seeing the city’s other major attractions. He also described sporting event tickets as high volume compared to the number of trips a tour operator can sell daily. Finally, India saw a 166 percent year-over-year increase in foreign visitors from January to April this year, writes Middle East and Asia Reporter Amrita Ghosh in Skift’s India Travel Daily.India’s Tourism Minister G Kishan Reddy said the country expects inbound travel to reach pre-pandemic levels later this year. India welcomed more than 6 million foreign tourists last year. The country’s tourism boom has also resulted in India’s revenue from the sector more than doubling in 2022 from the previous year. Indian authorities have also unveiled plans for marketing campaigns targeting international travelers. 

Episode NotesThe global travel industry is making consistent progress in its recovery from the pandemic. Skift Research’s Travel Health Index for May 2023 projects the industry’s travel performance will soon surpass 2019 levels. Research Analyst Saniya Zanpure reports the Index’s average global score in May hit 100 percent of pre-Covid levels, 2 percentage points higher than the previous month. Although that’s a 1 percentage point drop from April, Zanpure notes all regions except Europe have made a full recovery. And Europe is close to a complete rebound at 98 percent of 2019 levels. Fourteen out of the 22 destinations Skift Research has tracked have made complete recoveries from the pandemic. Zanpure adds Skift Research expects the others to do so soon, with the exception of Russia and Hong Kong.  Next, Indian airlines are continuing their massive aircraft ordering spree, with the country’s largest carrier IndiGo picking up 500 Airbus jets this week. But those huge orders present a big risk for Indian airlines eager to expand internationally, reports Edward Russell, editor of Airline Weekly, a publication.  IndiGo CEO Pieter Elbers said the order reaffirms the country’s confidence in an aviation boom in India, optimism that Russell writes is warranted. Elbers told Airline Weekly earlier this month that IndiGo would double in size by the end of the decade. However, Russell notes that numerous airlines have failed to tap the Indian market’s enormous potential, adding that infrastructure constraints are a persistent challenge. In addition, aviation data firm IBA has questioned whether the Indian market can accommodate the growing number of aircraft. Meanwhile, Elbers has outlined a three-part internationalization plan that includes new destinations and partnerships. Russell writes IndiGo will serve more international destinations by the end of the summer than it did before the pandemic. We end today with a look at the Urban Cowboy brand of boutique hotels, which Contributor Leslie Barrie says is looking to maintain a sense of community even while it expands. Urban Cowboy co-founder Lyon Porter admitted he didn’t have a real plan when the company opened his first hotel in Brooklyn in 2014. But Barrie writes Porter and fellow co-founder Jersey Banks have found their groove in building communal environments for “magical moments.” Urban Cowboy’s property in the Catskills in Upstate New York offers activities such as ax throwing and mushroom foraging. In addition, the brand’s Dive Motel in Nashville frequently hosts parties. 

Episode NotesChicago’s tourism industry has recently gotten a big boost from events like three sold out Taylor Swift concerts at Soldier Field. Local authorities hope the success of her shows can be the antidote to the city’s negative reputation, writes Global Tourism Reporter Dawit Habtemariam. Habtemariam reports 45,000 people came to Chicago over a June weekend when it hosted a large oncology conference in addition to the Swift concerts. One local hotel industry official said it was the best weekend for hotels in Chicago’s history. In addition, Chicago tourism chief Lynn Osmond said there were no major incidents downtown despite the huge crowds, a sign she believes the Windy City is well prepared to host major events. However, Habtemariam writes the city — and its tourism industry — has had to confront public crimes that have made nationwide news. In response to concerns about crime, Osmond wrote a letter to industry partners informing them the city was taking steps to address public safety.Next, luxury travel lodging company Habitas is planning to create a so-called hotel circuit in Saudi Arabia through a $400 million fund, reports Senior Hospitality Editor Sean O’Neill. O’Neill writes Habitas aims to transfer guests around locations in Saudi Arabia, where the company is looking to add six properties to its portfolio. Habitas already operates two properties in the kingdom. A Habitas representative said the fund would be anchored by the Saudi Tourism Development Fund. Saudi officials have expressed a desire to attract 100 million tourists annually by 2030. Finally, Australia’s flag carrier Qantas recently unveiled the cabin design of its Airbus A350 jets, which will feature a wellness zone, reports Contributor Jessica Wade. Wade writes the cabin design represents a significant milestone in QantasProject Sunrise, the title for its new nonstop routes from Sydney to London and New York. Qantas said it’s the first airline worldwide to develop a unique Wellbeing Zone on its aircraft. The zone includes a guided on-screen exercise and a hydration station. The nonstop flights from Sydney to London and New York are scheduled to take off in late 2025. Qantas also recently resumed service to New York for the first time in more than three years, with flights from Australia to New York via New Zealand. Australia’s flag carrier Qantas has resumed flights to New York City for the first time in more than years. 

Episode NotesTravelers will likely notice that hotel room rates are up this summer travel season compared to last year, leading to charges that hotel owners are raising prices to take advantage of pent-up vacation demand. However, Senior Research Analyst Seth Borko argues that surging rates aren’t a case of price gouging.Borko acknowledges that the average price of a U.S. hotel room rose 13 percent in May from the same month last year. But he reports that jump doesn’t account for inflation, adding the price of everything rose during the pandemic. Hotel owners in particular have seen the cost of items such fuel, food and laundry supplies increase. Borko notes inflation data suggests that most hotel owners are raising rates to keep pace with their surging costs. He also writes that if hotel owners aren’t making more profits from the increased rates, that’s not price gouging.  Next, more travel brands are turning to artificial intelligence tools to help users make bookings, with many companies believing the growing technology will help them operate more efficiently. But Travel Technology Reporter Justin Dawes writes not all of those booking tools will be successful.Dawes notes most companies want a virtual travel agent that can make bookings based on customers’ highly personalized preferences. Vacation rental listing platform HomeToGo is one company planning to release an AI booking tool. But Dawes writes it’s uncertain how small companies with limited data can compete against larger, wealthier rivals. He adds that the platforms that succeed will likely need to solve a unique problem or create a recognizable brand, feats many companies won’t be able to do. Finally, Australia’s flag carrier Qantas has resumed flights to New York City for the first time in more than three years. It’s another sign of airlines returning to normal after the pandemic, writes Jay Shabat, senior analyst at Airline Weekly, a Skift publication. Shabat reports that Qantas is initially flying to JFK Airport from Australia via Auckland, New Zealand three times a week. The company will increase that number up to four in October, a month that coincides with the start of Australia and New Zealand’s peak summer tourist season. Qantas views Auckland stopover as an interim measure until it receives a new set of ultra-long-range Airbus jets, possibly in 2025.CEO Alan Joyce said the company has seen enormous demand for the flights since they went on sale last year. 

Ask Skift Is the AI Chatbot for the Travel Industry. Try It.Episode NotesThe U.S. tourism industry has gotten a boost from the Biden administration lifting its vaccine requirement for inbound travelers in May. However, a prominent U.S. tourism official believes the industry won’t make a full recovery without the large-scale return of Chinese visitors, writes Global Tourism Reporter Dawit Habtemariam. Brand USA CEO Chris Thompson said at a U.S. Senate hearing this week that dropping the vaccine mandate has helped boost visitor numbers. But he acknowledged that the eased travel curbs won’t be enough to compensate for the lack of Chinese tourists. The U.S. welcomed over 540,000 Chinese travelers in April, a 81 percent drop from the same month in 2019. China reopened its borders earlier this year for international travel after more than two years of restrictions.Next, the short-term rental industry is poised to benefit enormously from the boom in summer travel, writes Short-Term Rental Reporter Srividya KalyanaramanA study by short-term rental data company AirDNA found the sector should see growth this summer thanks to strong travel demand. Kalyanaraman reports that this year’s summer travel season is expected to be extended as travelers seek off-season rates. She adds that lower house prices and sustained high demand for rental properties have contributed to an increased housing supply. More homeowners are choosing to rent out their properties rather than sell in a market with low interest rates.Finally, the U.S. Department of Commerce is looking for help in staffing the office for the newly-created assistant secretary for travel and tourism, a position Congress created last December. So what assistance is the department requesting? Roughly $3.5 million, writes Global Tourism Dawit Habtemariam. National Travel and Tourism Office Director Brian Beall said at a Senate hearing this week that the agency needs the money from Congress to be able to carry out its duties. The office’s responsibilities include developing strategies to help meet the U.S. tourism industry’s goals, including increasing visitor numbers. Congress hadn’t included funding for the office upon passing legislation to create it. Meanwhile, the assistant secretary position hasn’t been filled yet. 

Try the AI Chatbot for the Travel IndustryEpisode NotesTravel demand among Chinese citizens has surged since Beijing eased the country’s strict Covid-era curbs in January. So how can travel brands tap into one of the world’s most lucrative markets? Skift Research examines in a new report what strategies companies should take to attract Chinese travelers.Senior Research Analyst Varsha Arora writes Skift Research explored various stages of the Chinese travel journey, including planning and booking. The report also touches on the general economic outlook for Chinese travelers, including their widespread optimism. The report concludes with key takeaways for destination marketing organizations, which Arora notes provide valuable tips on how to engage Chinese travelers. Next, a growing number of real estate investors are looking to combine hotels with members clubs. However, Gansevoort Hotel Group President Michael Achenbaum warns blending a hotel with a club is more difficult than it seems, reports Senior Hospitality Editor Sean O’Neill. Achenbaum acknowledged the challenges while speaking at a recent hotel conference, citing his own experiences with the members club model. He said investors shouldn’t focus on finding the coolest people for members clubs, which usually charge an annual fee for access to co-working spaces and food and beverage offerings. Achenbaum said that investors should instead concentrate on finding the right people who will truly use the various spaces.  Achenbaum also noted another challenge of blending a hotel with a members club: Determining access for facilities, adding that not giving hotel guests access to certain spaces can be a problem. We end today looking at the highest-paid U.S. Airline CEOs for 2022, a year that featured a new twist for calculating executive salaries. United Airlines’ Scott Kirby took the top spot, bringing home $10 million, reports Contributor Kristin Majcher. Kirby replaced Delta Air Lines chief Ed Bastian as the highest paid U.S. CEO in 2022, both in terms of total pay package and a new method for determining executive salaries. A new U.S. Securities and Exchange Commission rule requires major, public companies to disclose a “compensation actually paid” figure. Majcher writes the new measure reflects the changing value of company shares, which usually represent a significant portion of an airline CEO’s compensation. 

Try the AI Chatbot for the Travel IndustryEpisode NotesAirfares in India have been soaring recently, and a new report finds the country registered the highest increase in airfares in the Asia-Pacific region, reports Asia Editor Peden Doma Bhutia. A study conducted by Airports Council International attributed the surging airfares to factors such as rising fuel prices and pent-up travel demand. The report noted that fuel prices have jumped 76 percent compared to 2019. The CEO of India-based travel agency Nomad Travels said fares for routes such as Mumbai to Delhi have almost doubled. The study also found the airfares have increased elsewhere in the Asia-Pacific region, including Indonesia, Saudi Arabia and Japan. However, one airline industry expert said rising airfares are unlikely to stall the surge in Indian aviation, with the country’s major airlines having recently announced record profits for the 2022 financial year. Next, tours and activities platform GetYourGuide announced on Monday it’s launching a tour devoted to Formula 1 icon McLaren Racing. It’s part of the company’s strategy to take advantage of the surging interest in sports-themed tours, writes Travel Experiences Reporter Selene Brophy.  Brophy reports the McLaren’ Originals tours will be available on a first-come, first-served basis starting on July 6. Jean-Gabriel Duveau, GetYourGuide’s vice president of brand, said the company has seen an explosion in demand for sports experiences. GetYourGuide’s booking data revealed demand for sports tours recorded a more than 130 percent year-over-year jump in the first half of 2023. Duveau added the company is working to develop behind the scenes tours of famous sporting venues. Finally, real estate investment firm Black Swan has acquired former short-term rental operator Lyric in an attempt to revive the brand, writes Short-Term Rental Reporter Srividya Kalyanaraman. Kalyanaraman writes Black Swan has bought Lyric’s domestic and international trademark rights as well as the lyric.com domain. Lyric was operating roughly 600 units in 17 markets during the first quarter of 2020 before closing many of its units early in the pandemic. The new Lyric is set to launch this summer, with Kalyanaraman noting that Black Swan’s real estate strategy will be to acquire trophy assets in key markets.