Will American Airlines go belly-up next year if the economy goes south? 

The largest airline in the U.S. has major financial issues on the horizon that appear to make it very vulnerable if the economy slips into a recession in 2024. Take one look at the stock price of AA and you will see that in the last 5 years their stock price has collapsed from a high of $40 a share to $12 as share today. Add to this the two largest expenses for an airline are employees and fuel prices. The airline was so desperate to resolve their pilots’ contract that they agreed to a $9 billion (40%) increase in wages over the next four years. Add to that the flight attendant contract that will also add at least 11% in year one and another 6% in years 2-4. Add fuel price increases of 23% in August alone and you can see that things don’t look too rosy at AA. Just this last week many of the airlines reported that demand is weakening and the pent-up demand from leisure travelers appears to be waning. Just think what will happen if a recession hits us! I am not a stockbroker and can’t advise you about your investments, however, AA looks to be staring at many financial headwinds next year. The two areas that will probably keep AA from default are they have a boatload of cash and the government will probably rescue them once again.

If we do head into a recession Marriott Hotels say hotel discounting will not return like the good old days – A recent presentation by Marriott claimed the era of hotel discounting may not return for a long time. The hotel chain has enjoyed strong pricing power as the pent-up demand led hotel rates to rise into the stratosphere. The new strategy by the hotel chain is to avoid trying to maintain current high occupancy rates with discounted pricing and instead maintain high pricing and accept lower occupancy rates. It is easy for Marriot to say this when they are sitting at high tide and have enjoyed an amazing 2-year ride of high rates and massive amounts of travelers. Let’s see if this new strategy holds up if recession winds start to blow.

Check out our Weekly Travel Alert Podcast – Did you know our Weekly Travel Alert Video Podcast is available on YouTube plus all your favorite podcast stations, Spotify, Google Podcast, Apple Podcast . Each week we are adding new and upgraded features. Please jump on board.  CLICK HERE to see the Weekly Travel Alert that is hot off the presses.

Corporate travel Managers expecting hotel rates to increase by 5% or more in 2024 – A recent BTN Hotel Survey just released reported that Corporate Travel Managers are expecting hotel rates to increase 5% or more in 2024. A large chunk (25%) anticipated that hotel rates would rise over 10% next year. CLICK HERE to read more.

Sustainability does not take a very high priority on the BTN survey of Corporate Travel Managers – Sustainability has been the second most popular buzzword (only second to Artificial Intelligence) in the press the last 12 months. What surprised me most in the survey was that very few people listed it as an important issue in the context of their corporate management goals. Perhaps they are just getting tired of talking about it so much.

Executive Travel is holding our annual Simplifying Travel 2023 forum in Fort Lauderdale this week – We are honored once again this year to host our Simplifying Travel 2023 (ST2023) meeting in Fort Lauderdale, Florida this week. This is our chance to bring together our customers, prospects, industry partners and staff to present a comprehensive look at the future of the travel management industry. We have some amazingly cool new technology to showcase as well as industry predictions and my favorite, a fast and fun look at all the new ideas to utilize Generative Artificial Intelligence (CHATGPT) for the travel industry. And here is the best part. We will be recording all the sessions at ST2023 and making them available for FREE to anyone interested. All you need to do is send us an email to info@executivetravel.com and we will add you to the list to receive videos of the presentations. Here is a short list of just a few of the amazing presentations:

• 2024 -Ready or not here we come – A look in the rear -view mirror at 2023 and Predictions For the travel industry in 2024
• Travel 4.0 – The Future of Travel Management – Post COVID
• My head is spinning! How do I keep up with all the travel industry changes?
• Press the easy button on Corporate Group Travel, Management and Reservations with Groupize.
• CHAT GPT and how Generative AI will affect the travel industry. 
• Fear No Evil – Here Comes NDC and How to Prepare for all the opportunities.
• How to build your 2024 Travel Management Business Plan that works
• Fast and Furious – New travel technology and how it will impact business travel in the future.

I am so excited to take our whole staff this weekend to Florida for a company meeting – One of the cool things we get to do as a Travel Management Company is hold our company meetings in nice locations around the globe. This weekend after Simplifying travel 2023 we fly all our staff to FLL and have a half day meeting to pull the team together, share our vision for 2024 and most importantly THANK THEM for being on our amazing TEAM. One important reason this meeting is so important to our company is that over 30 years ago we pioneered the use of virtual agents (work at home). This is the one time each year we all get together in one place to laugh, hug and learn. We are indeed blessed to have a team with a passion to serve others We want to thank them and thank you for the opportunity to serve.