High seas drama, hotel angst and a rogue robot

Welcome to our first official edition of Travel Essential, our weekly newsletter to help consumers and travel professionals navigate the new world of travel. 

Who we are: Barbara DeLollis and Jeri Clausing, veteran travelers and journalists with decades of experience reporting for national and international media outlets, including USA Today, The New York Times, Associated Press, Travel Weekly and more.

Our mission: To take you beyond the headlines and press releases to deliver frank insight and analysis about the changing travel landscape and the pandemic’s impacts on both leisure and business travelers. We’ll help you figure out where to go, how to find great deals, how to avoid fees and how to use the latest technological tools at home and on the road. 

Why? Because we love everything about travel (well, except economy class!) and the people who make up this exciting industry. But so much is still in question – from safety and testing and vaccine requirements to the financial health of individual companies. We know the industry and the key players. And we’re here to help provide clarity, from inspiration to booking to the rules of the road.  

We also want to have fun. Because travel should be fun. And that’s the one thing we all need more of right now. 

How to subscribe to the Travel Essential newsletter: For a limited time, we invite you to sign up for a complimentary subscription and follow us on Twitter. 

And now, let’s dig in… Here’s what we’re thinking about right now.

Drama on the high seas

The pandemic’s toll on the travel industry hit home in dramatic fashion with the recent collapse of Genting Hong Kong, which operates the much-loved luxury line, Crystal Cruises. While Genting’s filing for provisional liquidation and Crystal’s subsequent suspension of sailings caught many travelers off guard, it wasn’t without warning. Genting has been struggling throughout the pandemic to pay down its debt and make refunds for canceled sailings. Still, the move came with plenty of unexpected drama for guests. Before the company could suspend operations, a Florida judge issued a warrant to seize the Crystal Symphony over unpaid fuel bills – forcing Crystal to reroute the ship to Bimini and shuttle passengers by ferry to Miami. Now, passengers who were less than two weeks into an extended world sailing on the Crystal Serenity are also on their way to Bimini after Aruba refused to let them dock to disembark passengers there. As one guest told the Miami Herald, “It’s a colossal mess.”

What about cruise refunds? Crystal has suspended sailing until at least May while it works to restructure or find a buyer for all or parts of the company. Although Crystal has promised to make refunds, Travel Weekly legal expert Mark Pestronk says there’s no way for the company to make such guarantees as the Bermuda bankruptcy law that Genti filed under “apparently gives the liquidators the power to stop such payments in the interest of all creditors.”

Will we see more bankruptcies? Stay tuned: While Crystal is one of the first high-profile victims of the pandemic, one can only assume it won’t be the last. As we enter year three of Covid-19, many companies large and small are struggling to stay afloat. 

A rare pandemic success story? 

The New York Times reports the Dominican Republic has bucked the Covid downturn,  drawing an all-time record of 700,000 visitors in December, thanks to its lack of vaccine and testing requirements. According to the paper, some financial analysts calculated that the country was having its best year economically in 30 years. Still, not everyone is happy. Some locals fear their health is being put at risk for the sake of the tourism dollars.

Topsy turvey lodging

Don’t expect to be able to make sense of hotel rates and the trends driving them anytime soon. Consider: The average daily price of a U.S. hotel room in December reached an unprecedented $135 per night, reflecting hotels’ extraordinary pricing power, according to industry tracker CoStar Group. And this year, Wyndham CEO Geoff Ballotti said the company recorded its highest average daily rates ever for the last two weeks of December, reports Hotel News Now. Unlike airlines, many hotels are also still enforcing pre-pandemic-era cancellation penalties – we can personally attest, because we just had to sweet talk our way out of one at the Mr. C Miami hotel in Coconut Grove last week. But that’s counter how many airlines are approaching booking changes. Air France even promotes its no-change fee policy in its Twitter profile. 

Cloudy on the horizon: Even the experts who’ve tracked the industry for decades are reluctant to forecast what’s coming in 2022. Generally, though, they agree that hotels in sunnier, leisure-heavy locations like Miami or Nashville will continue have a better handle on pricing power than cities like San Francisco and Chicago, which have disproportionately relied on business travelers. Consider these rates for a midweek stay in downtown Hiltons in two contrasting locations: $139 at the Hilton San Francisco Financial District and $349 at the Hilton Downtown Miami (per Hotels.com).

New York City tells another befuddling story. Despite a dramatic drop in visits from both international tourists and business travelers, New York’s slated to get 48 new hotels this year – and pricey ones, too, such as the Ritz-Carlton in NoMad and the ultra-luxury Aman Hotel in Midtown’s iconic Crown Building, according to the Wall Street Journal. And they’ll open their doors at a time when the city has 125 shuttered hotels, says the New York Post. New York State Gov. Kathy Hochul doesn’t expect the city’s once-bustling tourism sector to recover jobs until 2026. Is this unusual? Not so much. Many high-profile hotel projects were financed and broke ground before the pandemic – and now, they’re simply in the next phase of opening, though in an uncertain time. With leisure travel driving the industry these days, the owners and investors of new hotels will surely aim to take advantage of their hunger for “new” and “different” in our age of sameness. They’ll also likely market to residents nearby who can drive or take public transit. Whether we will see those old-style “come try us” discounts that we used to enjoy remains to be seen. If you want them, then it’s best to go hunt them down. Check in with your travel agent, contact the hotel or follow the hotel’s social media accounts.

Will business travel ever recover? 

A just-published report by Truist Securities obtained by Travel Essential says “there is no statistical evidence yet in the forward booking data that business travel is starting to bounce back from the omicron setback.” Based on its analysis of millions of future reservations for U.S. hotels plus conversations, Truist estimates that Omicron postponed the return of significant business travel for at least three months – probably until spring. Patrick Scholes, Truist’s veteran lodging analyst, wrote that it’s “not impossible to believe that once omicron passes (March? April?) we could see a healthy acceleration.” The segment doing the worst? Full-service hotels (think: Hilton, Hyatt, Sheraton), though select and limited-service hotels have seen some impact, too. What’s interesting is that many business travel hotels are no longer offering 100% of their rooms to the public; many are capping it at 70% due to staffing shortages. 

Examples of what companies that book business travel are seeing, per Truist:

- Business travel cancellations from omicron started in mid-December and so far trends for the first three months of 2022 show a “weaker” scenario than the last three months of 2021

- Returns to offices are again being delayed

- Travel decisions are being pushed back to at least February by corporate travel managers and, overall, corporations are being cautious and waiting to make travel decisions

- Corporate rates have not changed much from 2021

What’s holding road warriors back? The many factors range from personal attitudes about travel risks to widespread comfort with Zoom to repurposing travel budgets. On top of it, you also have companies that still can’t land on definitive return-to-office policies - let alone communicate them clearly, which could create its own set of political troubles. We’re also seeing a small but growing number of companies with robust environmental, social and governance (ESG) programs moving to cut their carbon footprint by reducing travel. Last fall just as the Cop26 climate crisis conference got underway in Glasgow, for instance, life insurance company MassMutual’s Barings division Barings rolled out new accounting guidelines for business travel that added a dollar amount to flights beyond the airline ticket to reflect the “true” cost of that trip.

Runaway robot

In case you missed it, this light-hearted hotel story that went viral in the U.K. underscores how we all need a break sometimes. Turns out a rogue robot vacuum making its rounds kept going – right out the door of a Travelodge hotel in Cambridge. The hotel's assistant manager offered a beer for its safe return, and yet the tiny but mighty machine played around for an entire day outside only to be found Friday … stuck in a hedge. On the more serious side of the issue, however, the U.K’.s Telegraph weighed in with a plea against letting robots lead us on a race to the bottom amid labor and technological disruptions. Last week, Tesla CEO Elon Musk said that he considers Tesla’s development of a humanoid robot its most important project. “There is no doubt that robots will shake up the global work­force,” wrote Telegraph editor Lucy Burton, “but with a bit of long-term plan­ning there should be no reason that work­ers have to head for the exit like the run­away vacuum.”

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