OUTLOOK Car rentals bright spot
sure of hotels’ financial health, revenue per available room, would not return to 2019 levels until 2023 or 2024.
Michael Bellisario, lodging analyst for financial services firm Baird, also doesn’t see revenue per available room recovering until 2023 at the earliest, he said. He added that he believed that large, urban U.S. markets, which generally contain bigger, more profitable hotels, would lag behind smaller ones.
Marriott is seeing a slow return of domestic bookings, though many are by leisure travelers in vacation destinations. It said about 70 percent of its corporate clients worldwide were expected to ease or lift restrictions on employee travel within the next three months.
The car rental industry is perhaps the brightest spot among travel suppliers.
The average length of business travel rentals at Enterprise, National and Alamo has risen recently, said Donald Moore, senior vice president of business rental sales and global corporate accounts at Enterprise Holdings, the brands’ parent company.
Some business travelers are keeping cars up to seven days, compared with less than three days before the pandemic. They are driving distances — like from St. Louis to Chicago — that they previously flew, Moore said.
Recent polls also raise questions about the timing of a rebound in business travel and its possible replacement by virtual meeting platforms.
In a survey by Institutional Investor magazine last month, more than half of the chief information officers, portfolio managers and other investment decisionmakers said they did not expect to travel again until November and December, at the earliest. And 93 percent
of the more than 300 global companies surveyed in May by the BCG Henderson Institute, the research organization of the Boston Consulting Group, expected to permanently change “remote working and meeting policies,” while 66 percent anticipated permanently changing travel policies.
Among the challenges with resuming business travel are the varying guidelines put out by airports and airlines.
For companies to be comfortable sending employees on business trips, “there have to be somewhat consistent, clearly communicated guidelines,” said Mike Janssen, global chief operating officer and global chief commercial officer of BCD Travel, a travel management company.
“If I’m flying to Reno and connecting in Denver,” he said, “I may not run into the same rules at each airport, and I don’t know what to prepare for. I can’t determine if there’s risk, which will keep me from wanting to take that trip.”
Adding to the complications for Americans is the European Union’s decision to bar travelers from the U.S., as well as recent decisions by England and Scotland to maintain their 14-day selfquarantine requirement for U.S. travelers, even as they ended it for dozens of other countries. In the U.S., some states are requiring quarantines for travelers from other states where virus cases are rising. Chicago imposed similar rules last week.
Michael Premo, chief executive of the Airlines Reporting Corporation, which settles ticket transactions between airlines and travel agencies, said countries’ borders would not fully reopen until there were a vaccine and treatment for the virus, as well as “more stringent travel protocols.”
“Until international travel returns somewhat to normal, it will put a big damper on corporate travel activity,” he said.
Levere writes for The New York Times.