Marriott and Booking.com slash budgets and headcount as leisure travel demand from lower-income travelers hurts revenue growth
Nov 28, 2024
Reduced demand for budget hotels will slow hotel industry growth in 2024, a trend that is expected to continue into 2025. In November, real estate analytics firm CoStar and global travel data provider Tourism Economics revised their 2025 room revenue growth forecast downward from 2.6% to 1.8%.
Key takeaways
- Industry-wide cuts: Cost-cutting measures are being implemented across the leisure sector, impacting hotels, travel booking platforms and resorts.
- Marriott: The hotel operator announced plans to reduce annual pre-tax and administrative expenses by $80 million to $90 million. It also revealed plans to lay off more than 800 corporate employees in the first quarter.
- Booking.com: The Booking Holdings brand said it may reduce its workforce after slowing headcount growth over the past year. In the third quarter, its workforce grew just 3% year over year, compared with a 13% increase a year earlier.
- Vail Resorts: The ski resort operator is targeting $100 million in annualized cost savings by 2026, including a 14% reduction in its corporate workforce.
- Automation efforts: Several companies have announced plans to increase reliance on automation as a strategy to reduce costs.
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