Business Travel News - July 28, 2008 - (Page 4)

NEWS Marriott Reports Drop In Profit BY MICHAEL B. BAKER REARDEN BUYS EXPENSEWIRE Marriott CFO Arne Sorenson said Marriott International saw a drop in in a conference call that group busiprofit and sluggish domestic revenue ness was strong, with property revgrowth in the second quarter of 2008, enue up 6 percent and revenue on further indicating a hotel negotiating the books for the rest of the year up season more favorable to buyers than 5 percent compared with 2007. any in the past several years. However, he also said cancellations Marriott, the first major hotel are up a bit, group attendance is company to report performance for down and the pace of new bookings the quarter, this month reported indicated some meeting buyers were profits down 17 percent compared delaying their hotel bookings. with the second quarter of 2007, and Bjorn Hanson, clinical associate professor for the NYU Tisch Center for Hospitality, Tourism and Sports Management, said corporate rates negotiated in better times for hoteliers are keeping revenues afloat, as are the conventions and meetings negotiated in prior years. As buyers enter into negotiations in the next few weeks, it could mean even tougher times for hotels next year. “Business travel is stronger than leisure travel, and it will be stronger after Labor Day, helping in the last quarter,” Hanson said. “We won’t have as much of that in 2009.” Kevin Maguire, National Business J.W. MARRIOTT JR. Travel Association president and Expecting soft demand to persist CEO and travel manager for the University of Texas’ intercollegiate aththe company expects domestic de- letics, said buyers will take advanmand and revenue growth to con- tage of the leverage. “Hotels are tinue to slow for the remainder of going to suddenly find out that corthe year. “While there is much un- porate America has minds like elecertainty, we expect weak econom- phants,” he said. “We don’t forget ic growth and soft U.S. lodging de- the fact that we’ve been paying huge mand to persist into 2009,” Marriott premiums for hotel rooms the last three years. Now, it’s in our court.” CEO J.W. Marriott Jr. said. Meanwhile, PKF Hospitality ReThe company reported that revenue per available room in the Unit- search data released this month ed States grew by 1.4 percent for showed that U.S. air capacity cuts the quarter compared with the same of 10 percent could have a heavier period in 2007, and than For the latest breaking news, impact on hotelsdrop. the average daily rate the post-Sept. 11 see btnonline.com/bn increased by 2.3 perSorenson, however, cent. Outside of North America, said business travelers would still RevPAR was up 15.5 percent, and buy higher airfares and rely on more rates increased by 15.4 percent. heavily traveled routes that are less Overall, rates were up 6.3 percent likely to be cut. and RevPAR was up 4.2 percent. Marriott is still on track to meet For the rest of 2008, Marriott ex- its supply growth target for the year. pects global RevPAR to be flat or in- It added 9,000 rooms, 2,500 outside crease by up to 2 percent, and North North America, to its portfolio in the American RevPAR to range from a 1 second quarter, with 130,000 rooms percent increase to a 1 percent de- in its worldwide pipeline. ■ mbaker@btnonline.com ■ cline. Rearden Commerce late last month completed the acquisition of expense management company ExpenseWire for an undisclosed amount and has integrated the system with its online procurement platform. ExpenseWire will operate as a subsidiary of Rearden and management including CEO Andrew Vaeth will remain. According to Rearden vice president of product marketing Dan Ford, the integrated platform is available to agency resellers, including American Express Business Travel, which in September plans to offer ExpenseWire capabilities with its Rearden-based Axiom. INSIDE TRACK CWT INKS GLOBAL DEAL WITH AMEX CARD Carlson Wagonlit Travel and American Express Global Commercial Card this month announced a multiyear agreement to distribute and promote three American Express payment solutions in 21 countries. Amex now is CWT’s only preferred global supplier of payment solutions and combines several local agreements between the two companies and prior deals between Amex and Navigant International, acquired by CWT in 2006. In the next three to four months, CWT executive vice president of global supplier management Mike Koetting expects expansion to other markets, as CWT works on agreements with indirect issuers of Amex corporate cards. SOUTHWEST, CANADA’S WESTJET INITIATE CODESHARE Southwest Airlines and Canada’s WestJet plan to implement a codeshare arrangement by the end of next year, with the opportunity to coordinate other reciprocal arrangements, including ground handling, corporate account cultivation, frequent flyer programs and purchasing. The carriers said they would launch “a distribution plan” this year, and Southwest said it would sell WestJet inventory through its Web site, though the airlines “are not ready to announce routes, schedules, or fares.” The deal requires regulatory approvals from each carrier’s home government. SABRE TO USE BIDSTORK TECH IN RFPS, AUDITS Sabre Travel Network, following this month’s acquisition of online request-for-proposals management supplier BidStork, has launched a new hotel rate negotiating and auditing service for corporate travel management and plans on adding further capabilities through next year. BidStork, launched in 2006, is a Web-based tool that allows travel managers to create and deliver a hotel RFP compliant with the National Business Travel Association modular form as well as map hotels, negotiate rates and create final contracts (BTNonline, July 23, 2007). Sabre now can offer buyers and agencies RFP and rate auditing tools as well as reporting capabilities. In 2008 and 2009, it will add rate auditing and RFP management tools for hoteliers, benchmarking reports and multi-GDS rate auditing capabilities. DOLLAR THRIFTY, AVIS BANKING ON SUMMER DEMAND Dollar Thrifty Automotive Group and Avis Budget Group in early July each issued statements detailing difficult second quarters, but both Dollar Thrifty president and CEO Gary Paxton and Avis Budget chairman and CEO Ronald Nelson said in statements that they anticipate summer demand to outpace supply due to industrywide fleet reductions, leading to increased prices. However, Bill Knepper, senior director of business development for Advito, said due to slackening demand, he does not anticipate an increase in corporate rates. 4 Monday, July 28, 2008 www.BTNonline.com Business Travel News http://btnonline.com/bn http://www.BTNonline.com

Table of Contents for the Digital Edition of Business Travel News - July 28, 2008

Business Travel News - July 28, 2008
Contents
Inside Track
Profile
Newsmaker
BTN Research
Forum
Aviation
Lodging
Ground Transportation
Meetings Today
Travel Management
Expense/Payment
Destinations
Executive Dashboard
Washington Wire

Business Travel News - July 28, 2008