Tour operators will have to give better deals if recession hits US
Travel operators will have to cater more for consumers seeking deals if an expected economic recession hits the US.
Gambling and luxury travel hub Las Vegas has seen some weakness at the low end, but foreigners capitalizing on the cheap dollar and US vacationers unable to afford a trip abroad will help soften the impact,? industry executives told Reuters.
Online travel agencies could also suffer if travel declines but get better negotiating power with hotels eager to rent rooms.
“I wouldn’t say we’re immune to what goes on around us. I think our business model is a little more resilient,” said Daniel D’Arrigo, chief financial officer at MGM Mirage, the world’s second-largest casino operator, said at the Reuters Travel and Leisure Summit in Los Angeles.
Recent economic data points to a slowing US economy, increasing the risk of a recession.
He said some businesses on the Las Vegas Strip have already seen some erosion in demand for lower-end offerings.
One way to avoid potential damage to US hotel and casino business is to market aggressively to travelers from Europe who may be less impacted by US economic softness.
Report by David Wilkening
Chitra Mogul
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