The Best Western CottonTree Inn in Rawlins, Wyoming was charging $500 per night on the weekend before the total solar eclipse. Observers wonder whether Airbnb is blunting hotels’ power to charge even higher rates for such high-demand events. Best Western CottonTree Inn
The solar eclipse on Monday will test whether Airbnb, HomeAway, and other home-sharing sites are limiting the ability of hotels to charge surge pricing for one-off, high-demand events.
The map of the United States where people will have clear skies to view the total solar eclipse includes Wyoming, among nine other states. A search on Expedia shows some surge pricing for hotels on Sunday, the night before the big event. It’s not often that the Best Western CottonTree Inn in Rawlins, Wyoming can charge a nightly rate of $500, the Days Inn Laramie can levy $800, and the The Sterling Hotel and Extended Stay in Casper can ask for $1,890 (with only two rooms left, as of this writing).
Bloomberg reported Airbnb had 50,000 people staying along the path of the total solar eclipse Saturday and Sunday compared with just 11,000 the previous weekend.
Rigby, Idaho’s maxed-out Motel 6, the only hotel in the small town, population 4,000, “is charging $330 per night, over three times its normal rate, for a queen room this weekend,” Bloomberg reported. “The average Airbnb booked in Rigby is about $127. (It’s double the cost of the rental from last year.)”
After Monday, it’ll be up to the math wizards at research firms like STR and CBRE to determine if Airbnb-style lodgings effectively put a cap on how much hotels could charge. A recent study by CBRE Hotels, a hotel real estate consultancy, found over the past two years hotels were no longer able to charge rates as high as in prior years during the annual South by Southwest festival in Austin, Texas, although it noted there may be multiple factors involved.
The question the researchers should try to figure out is whether hotels could have charged even higher rates for events such as the solar eclipse or a popular festival. Hotels say they aren’t seeing much rate impact from Airbnb but the proof will be in the calculations.
Global Eagle Entertainment Is Breaking Nasdaq Rules
Global Eagle Entertainment, which provides Wi-Fi connectivity and content to 150 airlines, including Southwest, Norwegian Air Shuttle and flydubai, is in trouble with Nasdaq because it hasn’t filed yearly and quarterly financial reports since Fall 2016.
Global Eagle Entertainment, which was at one point was slated to report its second quarter results on Monday, has until Sept. 12 to come up with its overdue financial reporting to the Securities and Exchange Commission or risk being delisted from Nasdaq.
The company’s investor relations site doesn’t list when it will report second quarter results. Global Eagle Entertainment has attributed its inability to report its financial profit or loss to a weakness in financial controls that was exacerbated by its July 2016 acquisition of Emerging Market Communications.
That wasn’t the only recent headwind for the company. Chinese insurance firm HNA, which is Hilton’s largest investor, had been slated to invest $416 million in Global Eagle Entertainment, but in July a U.S. regulatory body, the Committee on Foreign Investment in the United States, blocked the deal.
The HNA-Global Eagle Entertainment deal was to be the beginning of a joint venture in China, which is now in doubt.
Many Tour operators sticking with barcelona
As Barcelona — and Spain, more broadly — hopefully recovers this week from the terrorism incidents August 17, look for many tour operators to stay the course and stick with the destination. KarryOn reported that several tour operators, including G Adventures and Intrepid Travel, were monitoring the situation but making no changes to their itineraries.
Airline Merchandising Speeds Ahead
The largest airline trade association, the International Air Transport Association, or IATA, will conduct another hackathon, this one in San Francisco. It’s part of IATA’s push to get technology companies to build the connections enabling airlines to distribute their preferred seats, amenities and fares directly to travel agencies and even non-travel marketplaces.
The August 25-27 coding event is notable because the airline group will hold it at the offices of LinkedIn in San Francisco, showing that the topic is gaining in cachet in Silicon Valley. Host airlines are United and Finnair, and lead sponsors include IBM and SITA.
Confidentially Speaking About Economic Outlook
At the end of the week, the annual Jackson Hole Economic Policy Symposium — the largest monetary-policy conference of the year — will take place. We know what you’re thinking: Part-ay with the central bankers! But seriously, while this is not about travel, the comments of Federal Reserve chair Janet Yellen will have a big impact on C-suite executives at major travel companies as they try to decide whether they should plan for steady growth in the next year or if a recession may be coming.
These pronouncements also impact decisions at corporations when they decide whether to approve business travel trips for road warriors.
Odds are that Yellen will say she sees growing confidence in the outlook for household spending. Obviously, the more people are spending, the more some of their budget will go to travel.