Good morning from Skift. It’s Monday, May 23, in New York City. Here’s what you need to know about the business of travel today.
Today’s edition of Skift’s daily podcast discusses the work overload at travel agencies, the potential over investment in all-inclusive hotels, and the airline merger that’s going all electric.
The pent-up demand for summer travel has created a surge in business for travel advisors. But that increased workload, as well as staffing shortages at travel agencies, is driving more advisors to feel burned out, reports Editorial Assistant Rashaad Jorden.
A recent survey by industry website TravelAge West revealed that 52 percent of advisors are suffering from burnout, which agency executives acknowledged they’ve seen. Joshua Bush, the CEO of Avenue Two Travel, said advisors at his agency have gone from having no business to being overwhelmed by the demand for travel, which he believes has made their jobs less enjoyable.
Meanwhile, Sarah Kline, the president of Time For Travel, said staffing shortages at her agency are exacerbating advisors’ sense of aggravation. Kline admitted she’s had to hire assistants and train them to replace employees who have quit their positions during the pandemic.
Next, major hotel brands have added more all-inclusive resorts to their portfolios in recent years. But Senior Hospitality Editor O’Neill reports in this week’s Early Check-In column that while the trend will likely continue, those hotel brands may not get the expected return on investment from all-inclusives.
O’Neill writes that one significant factor driving the acquisition spree is the growing number of all-inclusive luxury properties. The market share of all-inclusive luxury properties has significantly increased in both the Dominican Republic and Mexico since 1990, according to brokerage and research firm JLL Hotels & Hospitality Group. Big hotel brands, such as Marriott and Hilton, also believe they can make the all-inclusive model more profitable via using their loyalty programs as sources of direct marketing.
However, O’Neill adds there are reasons for major hotel brands to tread cautiously regarding investing in all-inclusive resorts, citing in particular the struggles of Club Med, a major player in the sector. In addition, a new generation of travelers might be less interested in the all-inclusive model that’s geared toward keeping them inside the resort’s gates. O’Neill writes shifting cultural preferences may push some travelers to engage with local communities during their trips.
We wrap up today with the planned merger of regional carrier Southern Airways Express and electric aviation firm Surf Air Mobility. The two companies have announced plans to create the first electric regional airline in the United States, writes Airlines Reporter Edward Russell.
The deal, which was unveiled last week, will see Southern and Surf Air go public under a $1.4 billion special purpose acquisition company listing later this year. Russell writes the merger is the first ever between a carrier and company developing hybrid electric technology, and it occurs during the aviation industry’s push to make air travel greener.
Stan Little, the CEO of Southern and future president of the merged company, expressed optimism that the deal would help the airline become the first to put paying travelers on a hybrid electric airplane. Southern and Surf Air anticipate up to $467 million in net proceeds from their merger and public debut.