Skift Travel News Blog

Short stories and posts about the daily news happenings around the travel industry.

Hotels

California Takes Aim at Junk Fees: New Law Mandates Upfront Pricing from July 2024

9 months ago

California Governor Gavin Newsom signed into law on October 7 a bill to ban mandatory hidden fees — also called junk fees — starting July 1, 2024.

“The price Californians see will be the price they pay,” said Rob Bonta, the state attorney general.

As Skift previewed, the law broadly requires upfront disclosure of any mandatory fees by hotel companies, online travel agencies, car rental companies, online concert ticket sellers, and others.

If a company doesn’t comply, a consumer could seek “at least $1,000” in damages via the state’s existing consumer protection claims processes. (See the law, embedded below.)

Junk Fee Reform

It’s unclear how California’s new law will impact companies in mid-2024.

California has the largest population of any state in the U.S., and so some big companies choose to apply its requirements nationally.

Yet there could be lawsuits from industry groups, and corporations could find workarounds to keep profitable fees. California has rules on fees for car rentals, but many online travel agencies choose to display those fees in ways that vary depending on jurisdiction.

Another wrinkle: Newsom hasn’t yet taken a position on another bill awaiting his signature, Senate Bill 537. He has until Saturday night to decide whether to let that bill pass into law. The bill would prohibit businesses that sell lodging for up to 30 days in California from displaying a room rate that doesn’t include all fees or charges (except government-imposed taxes) as of July 1, 2024.

It’s possible the Governor may feel the bill he’s signed already covers this, making a law specific to hotels unnecessary. Either way, the state’s 6,000 hotels and thousands of short-term rentals are currently facing new rules about the display of so-called junk fees, such as resort fees and housekeeping fees. 

Here’s the legislation that’s just passed:

Short-Term Rentals

Vacasa Announces Reverse Stock Split

10 months ago

Property manager Vacasa announced its intent to conduct a one-for-20 reverse stock split that’s geared to get its share price higher than $1 per share and therefore to be continued to trade on Nasdaq.

A vacation rental that Vacasa manages. Source: Vacasa

Its shares were trading for $0.48 midday on Friday.

The reverse stock split, authorized by the Vacasa board of directors September 1, would go into effect before midnight October 2, the company said. Vacasa’s split-adjusted shares would start trading on the stock market the next day.

Several companies, including Sonder, which went public via SPACs and have seen their share prices dip below $1 have similarly announced reverse stock splits.

Online Travel

Oyo India CEO and Europe Head Quit to Start Own Ventures

10 months ago

Ankit Gupta, the India CEO of hospitality technology platform Oyo, and Mandar Vaidya, the head of Oyo’s European operations, will both be moving on from the company.

“Ankit Gupta and Mandar Vaidya moved on from their roles six months ago in March 2023. We are proud of their achievements at Oyo and are thankful for their leadership. Both roles were already transitioned six months ago to Varun Jain, as chief operating officer India, and Gautam Swaroop, as CEO OYO Vacation Homes, respectively,” an Oyo spokesperson said in response to Skift’s query.

Both Gupta and Vaidya are set to embark on their entrepreneurial journey with Gupta expected to announce his start-up soon, a source told Skift.

Gupta, who earlier had been the CEO of Oyo’s Hotels and Homes, was appointed India CEO last year.

This February Oyo had reshuffled its management with Abhinav Sinha taking up the role of global chief operating officer and chief product and technology officer. Sinha, who has been with Oyo since 2014, was taking over the role from chief technology officer Ankit Mathuria, who left the company in June 2023.

Oyo’s proposed IPO launch is expected to take place around the Indian festival of Diwali, which falls on November 12 this year. The company that had earlier planned its initial public offering at $1.1 billion, reduced the size of the offering to between about $400 and $600 million

In May, Chinese hospitality company H World Group sold one-fifth of its holding of Oyo to United Arab Emirates-based family offices and institutional investors for around $9 million.

Rating agency Moody’s Investors Service had said it expects Oyo to generate between about $50 million and $55 million in EBITDA this fiscal year.

With plans to support the surge in business travel, Oyo has also announced its plans to double the number of premium hotels in India in 2023.

The company entered the premium resorts and hotels category with the launch of its new brand-Palette in July. The move comes as a part of Oyo’s ongoing efforts to make its premium property portfolio more versatile.

The company had said that the Palette resorts would be located in popular leisure destinations across India, while also catering to business leisure or blended travelers looking for quick getaways and staycations.

Tour Operators

Smartbox Group Acquires Nordic Experiences Platform Truestory

11 months ago

European-based experience gift platform Smartbox Group has acquired the Scandinavian experiences platform Truestory.

Lasse Kjær, founder of Truestory, announced the acquisition in a LinkedIn post, stating the Nordic-centred experiences platform, with some “1,000 live experiences from more than 600 hosts”, now had a “new owner who wants to invest in Truestory to redeem the long-term potential of the business.”

Skift reached out to Kjær for specific details on the sale, but he stated he was “unable to share the value of the acquisition right now.”

Truestory would continue to operate under the same brand as the site’s users know it, specifically strengthening Smartbox Group’s position in the Nordic countries of Norway and Sweden, René Drewsen, Cluster Director Nordic at Smartbox Group, said in a statement.

Founded in 2003, the Smartbox Group is present in nine European countries and claims it sells 7 million experience gifts worth an estimated $547 million annually. The company works with “40,000 European partners, distributing through 18,000 retail stores, supermarkets, websites, and online retailers.”

Online Travel

Trivago Gets New CEO and Leadership

1 year ago

Travel metasearch company Trivago said on Tuesday that Johannes Thomas had become CEO and Managing Director, succeeding Axel Hefer, as the company struggles to return to its pre-IPO glory days.

Thomas began at Trivago as an intern and rose to become the company’s chief revenue officer, with a specialty in business operations and strategy.

Other executive changes include included Jasmine Ezz becoming chief marketing officer and Andrej Lehnert becoming chief product officer.

At $1.20 a share on Tuesday, Trivago is in danger of seeing its share price go below $1 and becoming de-listed if it doesn’t turn around its financial trajectory.

For context, read this month's Skift article: Trivago’s Returns Take a Hit as Company Invests in Direct Connection Tool

Hotels

Oyo Claimed to Have Outpaced U.S. Budget Hotel Recovery

1 year ago

Oyo, which advertises itself online as “India’s Best Online Hotel Booking Site for Sanitized Stays,” said it is performing well in the U.S. — after de-emphasizing its U.S. presence during the height of the pandemic.

The Oyo Las Vegas Hotel. Source: Danielle Hyams/Skift

India is Oyo’s largest market.

The company said Friday that during 2022 its revenue per available room, an important industry metric, grew 18 percent in the U.S. compared with prior to the pandemic in 2019, versus an only 6 percent rise for its budget hotel peers in the country. The latter figure comes from STR data, Oyo said.

“Coastal Oregon, Miami, Myrtle Beach, Houston and San Antonio emerged as the destinations with highest RevPar in 2022,” Oyo stated. “Travel recovery was largely led by domestic travel in the U.S.”

Oyo has a potential initial public offering in the works in India.

Oyo, which is a hotel aggregator and operator, said it attracted nearly 20 percent more bookings over President’s Day weekend (February 18-20) in 2023 versus 2021.

Travel Technology

Travel Tech at JetBlue, Avis, Hilton and Avianca Still Seems Archaic

1 year ago

There’s been well-deserved excitement in travel tech circles in recent years about everything from the New Distribution Capability to chatbots and the arrival of generative AI, but the reality is that much of what passes for travel technology is still backwards these days.

An elevator at the Phoenix Airport car rental center on January 10, 2020. Source: Flickr.com/Tony Webster

Here are a few recent examples:

Avis: Rental Counter Can Be Unavoidable

Avis informed me a few days ago that I couldn’t modify an upcoming reservation at Newark Airport to add electronic toll charges because I made the reservation using points. In a chat, the Avis agent assured me I could add E-ZPass at the counter — although there are often elongated wait times there.

In November at Phoenix Sky Harbor Airport, as an Avis Preferred member, I was supposed to be able to view the app and go directly to the parking lot to retrieve my rental car, but that didn’t happen. Eventually, an Avis agent at the car rental counter told me I hadn’t been able to go directly to the car in the parking garage because I arrived during an employee shift change, and the cars were not in place and ready. The wait for the cars was at least 45 minutes at the rental counter.

JetBlue Ticket Modifications: You Need to Cancel and Rebook

In early January, I tried to modify a JetBlue flight booking at JetBlue.com, but wasn’t able to. During a text chat, JetBlue told me in what I think was an automated answer that since I booked the flight with points, I’d have to cancel and rebook it to make the change. “TrueBlue point bookings are managed online,” JetBlue stated. “Changes require you to cancel and rebook. Points are returned to the TrueBlue account. Bags/seats are refunded to the original payment.”

If I had booked the original flights with dollars instead of TrueBlue points, I probably would have been able to easily modify the booking online. But don’t airlines want their customers to join their loyalty programs, and redeem those points? Instead, there is a disincentive when points functionality lags.

Avianca Blames the ‘System’ on Multi-City Booking Issue

About a week ago, I wanted to book a multi-city itinerary on Avianca.com, but there was no option to do so. I was looking to book Punta Cana-Cartagena-Medellin-Punta Cana. I complained on Twitter in frustration, and Avianca kindly messaged me within minutes of my tweet that its customer service agents would reach out, which they did. But after a back and forth with one of the agents over a couple of days, he informed me that the Avianca “system” wouldn’t allow him to make the multi-city booking, either. The agent said I should try booking the tickets separately.

I did book the flights separately — but with another airline. 

Can’t Bypass the Front Desk at a Hilton Property

In November, I reserved a room for a few nights at a Hilton Garden Inn in New Jersey. A Hilton email informed me I could use the Hilton Honors app for a contactless arrival. The idea was to skip the front desk, head to my assigned room, and unlock the door with my phone.

When I arrived at the property, a very nice front desk employee informed me that for security purposes I would have to show her an ID so it turns out at this particular property, at least, there would be no bypassing the front desk. She then handed me a couple of card keys for my room door.

Moral of the Story?

Despite all the boasts from airlines, hotels, and car rental companies about seamless this or frictionless that, the reality is often more traditional and clunky. The travel industry still finds itself plagued by outdated, legacy technology or more modern applications that sometimes aren’t well thought out.

Online Travel

Travelzoo Moves To Fund Metaverse Experiences

2 years ago

Travelzoo, a hotel and package deal publisher, said in a financial filing on Tuesday that it would ask its stockholders to approve making a metaverse experiences scouting business a wholly owned subsidiary of Travelzoo. The business, Metaverse Travel Experiences (MTE), is currently wholly owned by Azzurro Capital.

The proposed consideration for the issuance of Travelzoo stock is mix of $10 million (details are explained in the document posted below) and 100 percent of the equity in MTE.

At a Dec. 28 special meeting, the company will ask shareholders to vote on allowing the hedge fund Azzuro Capital, an investment vehicle owned by Travelzoo founder Ralph Bartel, to pursue a transaction that would effectively leave Azzuro and Bartel with an approximate 50.01 percent stake in Travelzoo (up from 35.99 percent) and his brother, CEO Holger Bartel, with 4.1 percent. The company will issue shares of common stock representing approximately 27.5 percent of outstanding stock.

The planned subsidiary aims to build “relationships with creators and providers of high-quality metaverse travel experiences to broker contracts between such creators/experience providers and businesses planning to market metaverse experiences to consumers.” Skift covered the debut of the unit earlier this year.

The financial filing is posted below.

Online Travel

Trip.com Group Taps $1.5 Billion Loan Tied to Green Targets

2 years ago

Trip.com Group said on Friday it had tapped a $1.5 billion sustainability-linked loan facility, meaning that the financing terms link the debt’s interest rates to the Chinese online travel giant’s performance against specific environmental targets.

The Shanghai-based company will use three-year dual-tranche term loan facility to refinance some of its debt, and the rest for general corporate purposes.

The move appeared to be the first time a major online travel player adopted green finance. Last year, a shareholder initiative prodded Booking Holdings to do a climate change report. The report came out this year. In October, the company said its Booking.com brand would add emissions estimates to bookings soon. Trip.com-owned Skyscanner has estimated flight emissions for consumers for a few years.

Climate-related risk is on investors’ minds as they look at their portfolios. For travel in general, the sustainability-linked bond may provide more flexibility for investors worried about this issue, said Leslie Samuelrich, president of Boston-based Green Century Capital Management. Sustainability-linked bonds are different from green bonds. They set macro targets for a company, while green bonds commit to specific projects.

The investment concept is growing fast, Samuelrich said. Last year, lenders issued $103 billion in sustainability-linked bonds to companies across various industries. The year before that, it was about $12 billion.

In April, Ascott Residence Trust issued a sustainability-linked bond — apparently the first in the hotel sector — worth about $143 million ($200 million Singaporean). Ascott Residence Trust has committed to a sustainability performance target of greening half of its total portfolio by 2025, and its interest rates would essentially rise on the loan facility if it fails to meet the target.

The process remains murky and slow burn, though. There’s a debate about measuring the greenhouse gas emissions contributing to the climate emergency. IFRS Foundation, the international accounting standards-setting body, has this year been working on setting standards for emissions-focused reporting. Their work, and the work of other organizations, will adjust how investors evaluate climate risk — a knotty task inviting skepticism from some critics.

Side note: Trip.com’s chief commercial officer Schubert Lou will talk about the international division of Trip.com Group at Skift Global Forum East in Dubai on Dec. 14.

Travel Technology

Yanolja Profit Rises as Travel Rebounds in Korea and Asia Pacific

2 years ago

Yanolja said this week it expected that a post-pandemic rebound in international travel will continue to boost its twin businesses of online travel sales via a superapp and software sales to hotels and other travel companies. The South Korea-based startup has made progress on both ambitions since 2011, when it received a $1.7 billion investment from the Softbank Vision Fund in a transaction that valued Yanolja at the time at approximately US$9 billion.

The privately held travel company in South Korea reported this week some of its financial results for the third quarter, saying it had experienced “high growth rates in all business areas.”

Yanolja recorded consolidated sales of approximately $147 million (192.2 billion Korean won) in the quarter, a 112 percent jump from the same period a year.

Unlike many travel startups, the company is profitable. Yanolja reported an adjusted earnings before interest, taxes, depreciation, and amortization, of about $8.1 million (10.6 billion Korean won).

Roughly half of the company’s growth has been partly driven by its software business, which had a 32 percent year-over-year increase to $71 million in sales in the quarter. For more context on the travel software sales, see Skift’s story Decoding Yanolja Cloud and Its Hotel Software Strategy.

The mid-sized company said it has been staffing up for roles in product management, software engineering, and user experience design, and has cash on hand to make acquisitions.

Jongyoon Kim, CEO of Yanolja, will discuss the company’s overall strategy and business performance at Skift Global Forum East in Dubai on December 14. Kim joined Yanolja in 2015 as chief strategy officer and in 2021, was elevated to CEO. He has previously worked at McKinsey & Company, Google, and 3M. Many industry analysts wonder if Kim will be able to guide the ambitious tartup to a successful initial public offering someday, and if so, when.