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Travel recovery looks steady despite global weakness

July 18, 2012 | Hotel Marketing

While hotel revenue growth has slowed a little bit, strong demand from business and leisure travelers will help U.S. hotels and airlines produce solid revenue and profit in the second and third quarters.

But aside from that bright spot, Europe's economic woes and possible slowing growth in China and India could make for a murkier travel outlook. Those factors, combined with investor nervousness over the result of the upcoming U.S. presidential election, are spurring worries that business and leisure consumers could curb their travel a bit farther down the road.

"The reality is growth has slowed a little bit," said Jon Cummins, chief operating officer of Philadelphia-based Amerimar Enterprises, which owns properties that cater to business travelers such as the luxury St. Ermin's Hotel in London and Sheraton Atlanta. "Yet we're still seeing modest improvements in the hotel metrics."

The two main components of the travel industry -- hotels and airlines -- are somewhat different animals. In general, the hotel industry has a more favorable outlook this year thanks in part to the limited supply of rooms. The airline industry is more volatile due to the price of jet fuel and other factors.

Get the full story at Reuters

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