Iraq-Related Quotes By Hospitality Groups of A Looming War
"Our 2003 projections assume that there is no measurable recovery in the economy until the end of 2003, there are no major terrorist attacks against the US, and we have not built in any impact of a potential war with Iraq. When Sept. 11 happened, it took us 14 days to implement a plan; in the event of war in Iraq, we will be ready to implement our plan within 24 hours."
War with Iraq Would Likely Cancel RevPAR Growth
The prospect of a war with Iraq also creates great uncertainty in the lodging market. Using the Gulf War experience that occurred in the first quarter of 1991 and assuming a short war would take place in the second quarter of 2003, the HRG/TWR analysis shows that a war with Iraq will have varying consequences within the branded lodging market. The chain-affiliated, full-service segment would be negatively affected by a war, while a war would have a negligible impact on the branded limited-service segment. In particular, forecasts suggest that at the national level, a war lasting approximately one quarter during the first half of 2003 would reduce expected RevPAR growth during the second quarter of 2003 to practically zero.
Based on continued soft demand trends, but without factoring in the impact of any possible conflict in Iraq, we currently estimate REVPAR in 2003 to be roughly flat compared to 2002 levels. With flat REVPAR, the company expects hotel house profit margins to decline approximately one to two points as a result of continued pressure on casualty insurance and medical benefits cost increases. Factoring in new unit growth, but not including the effects of a possible war, lodging profits are expected to total $710 to $740 million in 2003.
'We are encouraged by the positive signs that the international hotel industry may have reached the bottom of the cycle, and absent of a protracted confrontation in Iraq, we are cautiously optimistic about the prospects for the industry in 2003.'
On the governmental affairs side, AH&LA is offering tips to employers regarding military leave policies. Recently, nearly 100,000 military reservists were called to active duty as the United States prepares for a potential war with Iraq. AH&LA is encouraging hotel companies and properties to review their obligations on providing leave, reinstatement, and other benefits to employees that serve in the armed forces.
Imagine the scene. - War is looming, and booking a holiday is the last thing on many consumers' minds.The leisure travel sector fears a meltdown in business, and is hoping against hope for a short, sharp conflict followed by a dramatic recovery in confidence. Sounds familiar? - That was the situation in the winter of 1990-1991, in the wake of Iraq's invasion of Kuwait.Now, amid the latest crisis in 2003, booking figures show that consumers are reacting in an uncannily similar way suggesting that the experience of the Gulf War may present some valuable lessons for tour operators facing a re-run.