Loews Hotels CEO Jonathan Tisch does not expect a return to significant national, international or business travel anytime soon, according to an interview he gave on CNBC’s “Closing Bell.”
“It’s a challenge,” he said. “We were excited about reopening hotels … but sadly we are in states that are spiking so the numbers that we were starting to feel good about are reversing. That’s going to be a really tough position for our industry.”
When asked if working from home will continue to chill business travel, Tisch said surveys are indicating as much.
“There probably will be no return to significant business travel in the fall,” he told the network. “Groups are an issue, until regulations change and we can put more than 25 to 50 people in one meeting at a time.”
Tisch declined to provide occupancy rates at the two dozen luxury hotels Loews owns or operates in the U.S. and Canada. In some cities, they are doing OK, he said.
“But you have to understand that we are spoiled in the businesses,” he said. “We had many quarters of really strong occupancies, strong ADRs [average daily rates] and RevPar [revenue per available room] increases, and we are not seeing that now.”
Tisch recommended Congress extend the Paycheck Protection Program (PPP) at least until the end of the year, adjust the tax code, reinstate the business meals deduction and adopt a tax credit for travel.
On whether the sector will see bankruptcies, he said 20 percent of New York’s hotels will not reopen.
“That could be the story across the board, it is a very tough time for travel and tourism,” he said.
A survey by MMGY Travel Intelligence and the U.S. Travel Association taken April 17-22 revealed 47 percent of respondents said they would be more likely to travel by car this summer, up from 35 percent the prior week.
In related news, the number of travelers passing through airport security checkpoints across the U.S. fell by more than 4 percent in the week ending July 19, according to the Transportation Security Agency (TSA). A total of 4.6 million travelers passed through airport gates July 13-19, down from the 4.9 million passengers the TSA clocked in the week ending July 12.
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