Major Chinese Hotel Company Dampens Recovery Outlook for Remainder of Year
Photo Credit: Huazhu leaders aren't convinced of the travel industry's recovery momentum continuing into fall due to the Delta variant. Wikimedia / CEphoto, Uwe Aranas
Skift Take
Finally, a hotel leadership team is honest and admits the Delta variant is a real threat on the hotel industry’s recovery. Huazhu's candor is something the C-suites at Marriott, Hilton, and Hyatt should replicate.
It wasn’t long ago when major hotel companies expected a full recovery in China sometime this year. That’s no longer the case.
Shanghai-based Huazhu, one of China’s biggest hotel operators that also runs Steigenberger Hotels in Europe, posted a $59 million second quarter profit Wednesday. But company leaders cautioned the road to a full pandemic recovery is bumpy. The second quarter strength largely came from the months of April and May, even briefly outperforming 2019 levels, before an outbreak of new cases emerged in Guangdong province.
A more extreme, recent outbreak of cases impacted more than half of China’s provinces and ushered in a new wave of lockdowns and travel restrictions. The uncertainty around flare-ups has Huazhu leaders anticipating a full recovery isn’t likely this year — a notable break from the optimism collectively shared by most hotel executives in recent weeks.
“We have to admit that the Chinese government has imposed a very strict travelin
