Accor’s Corporate Reorg, Explained

Good morning from Skift. It’s Wednesday, January 25. Here’s what you need to know about the business of travel today.

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Episode Notes

Accor’s plans for a major corporate overhaul have raised eyebrows from banking analysts and executives at rival hotel giants. But Accor CEO Sebastien Bazin is defending the Paris-based company’s reorganization, reports Senior Hospitality Editor Sean O’Neill.

Bazin said changes in Accor’s structure were necessary during an interview with Skift this week at the Americas Lodging Investment Summit, or ALIS, in Los Angeles. Accor’s management has split the company into two groups, with one focused on luxury and lifestyle brands. Accor has also created a unit devoted to premium, midscale and economy brands. Bazin had argued that Accor’s previous structure didn’t enable its star brands to thrive, adding that its reorganization will help them make inroads in the Americas.

Bazin also stated he’s happy with Accor’s hiring, noting the company hasn’t had any trouble finding candidates to fill corporate positions. He said Accor plans to hire roughly 500 people for roles at its luxury and lifestyle brands.

Next, budget airlines are rapidly adding routes between the U.S. and Europe for the upcoming summer. However, their market share of transatlantic routes will be roughly half of what it was four years ago, good news for the industry’s most prominent players, reports Edward Russell, editor of Airline Weekly, a Skift brand.

Norse Atlantic Airways and Play Airlines recently unveiled transatlantic routes, but Russell writes they really won’t provide cost-conscious travelers a lot of options for new flights. He notes that low-cost carrier Norwegian Air cutting long-haul flights early in the pandemic enabled major airlines to charge higher fares for transatlantic routes. Norwegian Air’s decision also reduced competition from budget airlines, helping United Airlines and Delta Air Lines cement their positions on top of the transatlantic market.

Finally, Marriott executives acknowledge the surge in blended business and leisure trips makes tracking guest behavior challenging. But they believe the trend will provide them opportunities to develop new products, reports Senior Hospitality Editor O’Neill.

Marriott CEO Anthony Capuano said on Tuesday at ALIS that blended trips will not only continue but increase. While it’s becoming more difficult for Marriott and its rivals to figure out whether guests are traveling for leisure or business, O’Neill writes the changes in long-term stay behavior have changed how Marriott approaches its offerings. The company said last November it would debut a brand in North America called Apartments by Marriott Bonvoy, which one executive said it had seen a demand for with travelers increasing the length of their stays.

Skift examined the evolution of blended business and leisure trips in one of its 2023 Megatrends.