Everyone has truly been impacted by the coronavirus (COVID-19). This pandemic has essentially halted all non-essential travel and kept people in their homes. Unfortunately, for many businesses within the travel industry, it has resulted in millions in losses. Take a look at the top 7 travel brands that have been hit hardest by COVID-19.
Delta Airlines (And Other Airlines)
Unsurprisingly, there are several airlines on this list. On March 21, several American airlines told Congress they need cash and loans to help fight the impact of COVID-19. Senate Republicans are proposing $58 billion in coronavirus aid for airlines such as Delta, Southwest, Alaska, American United, JetBlue, and Hawaiian. The airline industry is bleeding money on multiple fronts too: stock prices for airlines are plummetting, people are not booking future flights, and customers are demanding refunds and credits for canceled flights.
As one example, Delta Airlines announced that they were cutting their operations by 70% and that March 2020 revenue will be $2 billion short in comparison to March revenue the year prior.
Marriott International Inc. (And Other Hotels)
Marriott International Inc. is the world’s largest hotel company with 1.4 million rooms worldwide. The lack of hotel bookings over the last few weeks has resulted in the corporate office furloughing more than two-thirds of it’s 40,000 corporate staff. Many hotel executives have chosen to forego their salaries during this crisis. But it’s not enough. Recently, major hotel chain players, such as Marriott, Hilton, and Hyatt, all have gone to the Senate to ask for help with their grave situations. They’re asking for $250 billion in financial aid.
In an unusual turn of events, hotels remain so empty that some brands are considering turning their properties into coronavirus hospitals.
On March 14, Disneyland decided to close its doors for at least two weeks (but most likely, this will be extended). The Walt Disney Company reported $26.23 billion in revenues in 2019 from its parks and experiences business segment. That means the cost of shutting down the park for even a month could mean hundreds of millions of dollars. And, the financial toll can impact more than just Disneyland. The Orange County government estimated that Disneyland contributed approximately $8.5 billion to the regional economy through its influx of tourists. Already the local government fears what will happen if the park stays closed for an extended time.
Royal Caribbean Cruises (And Other Cruises)
Royal Caribbean Cruises is the second-largest cruise company in the United States. In the light of the coronavirus, Royal Caribbean Cruises, Carnival Cruises, and Norweigan Cruise Line Holdings, all have temporarily stopped sailings. After all, a tight-packed cruise increases the possibility of infection for both travelers and crew members on board. And, there have been several COVID-19 cases related to cruise ships over the last few weeks. Royal Caribbean Cruises has acquired a $2.2 billion line of credit to help them through these times.
It seems ever since Airbnb has entered the travel industry marketplace, it’s done nothing but succeed in every way. Well, unfortunately, COVID-19 may be the thing that bursts the Airbnb bubble. Airbnb has reported that bookings have been down in all of its major markets, as much as 50-95% in comparison to last year. And, just three months into 2020, Airbnb is reporting hundreds of millions in losses due to coronavirus.
Back in February, when the coronavirus hadn’t quite reached the scale it has now, Expedia predicted a $30-40 million impact on their revenues due to coronavirus. They haven’t released updated figures since the situation has worsened. But, experts estimate that Expedia will earn $65 million for their first quarter, which is almost one-third (down from $176 million) what Expedia made in the same quarter last year.
Contiki is a popular travel tour company that caters to individuals ranging from 18-35 years old. It’s a globally recognized brand that operates in more than 75 countries. To date, Contiki has suspended all of its trips that depart on or before April 30, 2020. Currently, trips booked for May 1, 2020, and later are still scheduled to run. Contiki has offered credit for customers with impacted trips, with the opportunity to rebook for some time in 2020 or 2021.
While Contiki hasn’t released any statements about the impact COVID-19 has had on their revenue, it’s undeniable it’s been significant.
Looking To The Future
We are confident that most of these major travel brands are going to make it through these difficult times. People will begin to travel again and these brands should recover. It will be interesting to see if any new policies are introduced because of COVID-19 around cancellations and trip insurance.