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Skift Take
Good morning from Skift. It’s Thursday, April 25, 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 Google’s huge travel recovery, Wyndham’s growing ambitions, and Finnair’s solution to its Russian problem.
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Episode Notes
Google has benefited enormously from travel’s rebound, with its parent company Alphabet revealing during its first-quarter earnings call on Tuesday that the sector has contributed significantly to the growth of Google’s advertising business. And with the tech giant’s travel search activity higher than during the same period in 2019, the company appears to be the winner in the metasearch wars, writes Research Analyst Seth Borko for Skift Research’s latest report.
The report, A Deep Dive Into Google’s Impact on Travel 2022, also includes five critical questions about the company’s role in the industry’s recovery as Borko writes that every travel executive needs to be asking “What’s our Google strategy?” In addition, the report delves into topics such as how much are travel companies spending on Google and how the tech giant is influencing hotel and flight bookings.
Next, hotel executives have expressed concerns in recent months about issues such as inflation, labor shortages and supply chain disruptions hitting their bottom lines. But Wyndham Hotels & Resorts — the world’s largest franchisor of hotels — is optimistic about the future, betting the increase in hotel investors represents significant growth for the industry, reports Senior Hospitality Editor Sean O’Neill.
Wyndham President and CEO Geoffrey Ballotti said during its first-quarter earnings call on Wednesday that its franchisees believe they’re starting a supercycle that might last a decade. The term supercycle refers to a period of above-average growth without the trajectory of a standard economic boom and bust cycle. One reason O’Neill cited for the rising interest in franchising hotels is the long-term guest demand for roadside properties. Companies entering contracts to build roads, bridges and waterways following Congress’ recent passage of an infrastructure bill will need to find accommodation for workers, which O’Neill writes provides an opportunity for hoteliers.
Meanwhile, Wyndham reported a profitable first quarter as it generated $106 million worth of net income, a number five times the figure it recorded for the same period in 2019.
Finally, airlines have rerouted flights after Russia closed its airspace to aircraft from dozens of countries in early March in response to nations doing the same to Russian aircraft. But perhaps no carrier is bearing the brunt from Russia’s decision as much as Finnair, which has been forced to make major changes to its operations, writes Airlines Reporter Edward Russell.
Finnair CEO Topi Manner acknowledged during the company’s first-quarter earnings call on Wednesday that it’s uncertain how long Russian airspace will remain closed. That closure forced Finnair to suspend flights to North Asia during the early portion of the war in Ukraine and it’s a reason why Finnair flights to 10 Asian destinations are still suspended. The carrier’s overall Asia capacity will also be down 65 percent in the third quarter, according to airline industry data company Cirium.
As Finnair realizes it must shrink in the long-term, Russell writes, the airline has already sold four A321s, a decision it made because of its lower-than-planned flying levels.
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