Arnie Weissmann:
Jeri Clausing:
12
IN OTHER NEWS:
With Galveston still off-limits
after Ike, Carnival temporarily
moves two ships to Houston. 6
53
www.travelweekly.com
THE NATIONAL NEWSPAPER OF THE TRAVEL INDUSTRY
SEPTEMBER 22, 2008
[ ON TOP OF CREDIT SQUEEZE AND AIRLINE CUTBACKS ]
Chaos in the financial markets
threatens all of travel industry
Analysts predict deep cuts
in demand and a virtual halt
to global hotel development
Corporate travel managers
expecting major revenue hit
from Wall Street job losses
By Jeri Clausing
Mounting economic turmoil and the loss
of tens of thousands of Wall Street jobs will
erode travel demand and bring new hotel
development to a virtual halt, travel experts
and analysts predicted last week.
“This is a fairly severe change from a week
ago,” Bjorn Hanson, a former Pricewater-houseCoopers analyst who is now a professor
at New York University’s hospitality school,
said of the outlook for travel demand following last week’s collapse of Lehman Brothers
and the government’s bailout of AIG.
One of the biggest hits could come in luxury travel, which until now has been the one
market segment that seemed somewhat insulated from the economic downturn.
“Since about 10% of luxury travel is directly or indirectly tied to the financial
ndustry, we’ll now see an effect on luxury
See FALLOUT on Page 55
The entire travel industry has a stake in the
crisis of confidence that shook Wall Street
last week, but corporate travel managers
in particular will feel a hit as the shakeout
thrusts the financial sector into a crash diet.
The two largest corporate travel ma
nage-ment companies, American Express Business
Travel and Carlson Wagonlit Travel, have significant exposure in the financial sector.
According to Business Travel News’ just-released “2008 Corporate Travel 100,” AmEx
counts several of last week’s headline makers
among its clients, including Lehman Brothers ($48.9 million in 2007 U.S.-booked air
volume), Bank of America ($142 million),
AIG ($58.1 million) and EDS ($61 million).
Lehman Brothers, the fourth-largest U.S.
investment bank, declared bankruptcy, t hen
executed a pending $1.75 billion sale of its
See WALL STREE T on Page 54
By Dennis Schaal
B i
tt
e r
bidd ers
Cruise passengers unhappy with artwork
they purchased at onboard auctions are
frustrated that cruise lines aren’t doing
more to help them.
By Johanna Jainchill Page 22
[A PRUDENT STEWARD WITH A REASON TO CELEBRATE]
What market crash? Starwood’s CEO
rings Exchange bell, then parties on
By Jeri Clausing
NEW YORK — Starwood CEO Frits van
Paasschen and Senior Vice President Hoyt
Harper rang the opening bell at the New York
Stock Exchange on the morning of Sept. 15, a
day that kicked off one of the worst weeks in
Wall Street’s history.
They spent the rest of the day in Central
Park celebrating the makeover of their Sheraton brand, hosting associates from their
White Plains, N. Y., headquarters for a “global
out of the office day.”
Hundreds of workers in jeans sprawled
under trees or sat at conference tables in outdoor mockups of the new Sheraton lobbies,
where they conducted their business through
Link@Sheraton lobby technology, which offers guests free WiFi and access to computer
terminals.
See STARWOOD on Page 56
T W PHO TO ILLUS TRATION B Y THOMAS R LECHLEI TER
In true Starwood fashion, the party atmosphere played on, despite the freefall under
way on Wall Street. Asked in a mid-morn-ing interview how the markets were faring,
van Paasschen said he wasn’t really sure. “I’ve
been too busy running around here to see
the latest,” he said.
