WTOto Protocol. Another failure?

FOXTROTS

 

 

Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning. 

Foxtrots – leading the industry in a dance.

 

 

2008 September 27

WTOto Protocol. Another failure?

The reason the Kyoto Protocol failed is not, as popular opinion has it, because the US did not sign up. But the reason that the US did not sign – developing economies do not need to reduce their emissions.

 

Now the World Tourism Organisation is making the same errors concerning plans in the travel business – what I might call the WTOto Protocol.

 

As I have already said before, the WTO appears to spend more time saying how important is action against climate change, than doing anything – apart from proposing more meetings and making honourable declarations, viz:

[] “We must increasingly help to make carbon clean. And we must start now.”

[] “We are part of the problem and will be part of the solution.”

[] “The 2008 World Tourism Day Theme will be ‘Tourism – Responding to the Challenge of Climate Change’”.

[] “For the past 5 years, [the WTO has advanced] the thinking on the relationship between tourism and climate change. These continuing initiatives [are part of the effort] to…tackle the climate change challenge.”

 

Now the WTO has taken a step backwards. At a global-warming meeting, WTO’s head said:

 

“…Recommendations [to reduce the threat of climate change] should not discriminate against developing countries by creating obstacles to their economic development and in particular of those developing countries located at long distance from tourists generating markets.” (Sic.)

 

Ignoring syntax and even logic errors, does the WTO know that the exception for ‘developing countries’ (primarily the BRICs; Brazil, Russia, India, China) caused Kyoto to fail? To give just one indication, new power stations planned by China and India would produce five-times more greenhouse gases than those saved by Kyoto.

 

The WTO has yet to make any proposal for the travel business, yet it is already introducing exceptions.

 

 

 

The Fox

Desert duel. Abu Dhabi v Dubai.

FOXTROTS

 

 

Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning. 

Foxtrots – leading the industry in a dance.

 

 

2008 September 25

Desert duel. Abu Dhabi v Dubai.

Abu Dhabi and Dubai in the United Arab Emirates continue to battle to better the other.

 

But Abu Dhabi, capital of the UAE, runs behind Dubai, the business capital, in three measures – business/economy, airline, visitors. That is partly because Abu Dhabi started much later in these three areas, and as such cannot do much more than seek to better Dubai’s implementation of the same broad plan.

 

For instance, Etihad, Abu Dhabi’s airline challenger to Dubai’s Emirates, is half-matching Emirates’ businessplan. But not only was Emirates first, but Dubai also started to build a visitor business long before Abu Dhabi did.

 

As a result, Abu Dhabi is well behind Dubai in visitor numbers, see below, although it may attract more cultured visitors – such as San Francisco when compared with Los Angeles, and Melbourne compared with Sydney. This can be seen with Abu Dhabi’s deal to build a Paris Louvre museum and a new environmentally-friendly city – to compare with Dubai’s scandalous snow-ski slopes and Palm real-estate development.

 

[] Abu Dhabi’s Etihad sold 4.6mn seats, up 67%, in 2007, not yet one-quarter of Emirates’ size. Not all data is released, so comparisons cannot be categorical – but Etihad’s capacity at least doubled (aircraft numbers, for instance, increased from 13 to 37), so growth should have been faster than that 67%.

 

In terms of visitors, Abu Dhabi is much smaller also. In 2007 its target was to increase hotel guest numbers from 1.35mn in 2006 to 3mn by 2015 – which would have meant an average annual growth of 9%. It has now upped this target, to 2.7mn for 2012, which would mean an annual 12.2% growth.

 

Development included increasing hotel capacity from 10,000 rooms to 25,000 by 2015 (4.6% yearly), but that too has been increased – that is now the total for 2012 (7.0%). Abu Dhabi’s airport is growing faster than Dubai’s, but that is partly because it is much smaller – 6.9mn passenger throughput, up 31%, in 2007.

 

[] Dubai’s Emirates airline is well ahead of Etihad – almost five-times bigger – because it has had a much longer start and an impressive business plan. It increased revenue 32.3% to US$10.8bn in the year through March 2008. That is better than traffic growth – seat sales up 21.1% to 21.2mn – and aircraft, by about 10% (11 aircraft to total 114) in numbers but probably about-15% in passenger capacity (total capacity increased 14%).

 

Emirates became the second airline after Singapore Airlines to launch A380 flights, starting this year with Dubai-New York then Dubai-London. According to some (Airbus has different figures) it has ordered 58 A380s.

 

Dubai targets 15mn visitors in 2010. Figures are casually given, often without qualification. Most-used to define ‘visitors’ is actually the count of hotel guests. In 2007 in Dubai that was 7.0mn, up 8% – which makes 15mn by 2010 look not possible.

 

Airport passenger throughput was 34.3mn, up 19%, although much, probably half, could be transit traffic. On the assumption that most travellers arrive and depart, that leaves a total around 8.5mn, of which a part would be local residents. But 15mn looks tough even for that measure.

 

 

The Fox

Barbara Cassani; jury’s in.

FOXTROTS

 

 

Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning. 

Foxtrots – leading the industry in a dance.

 

 

2008 September 19

Barbara Cassani; jury’s in.

Quinlan Private, relatively-new owner of 22-hotel Jurys Inns, a budget-hotel business, has appointed Barbara Cassani to the new role of JI chairman. QP says Cassani has a track record of developing fast-growing businesses profitably and extensive experience in the budget travel sector.

 

That is stretching the facts.

 

Cassani was appointed non-executive chairman of Barcelona-based low-fare-airline Vueling last September. But she is perhaps best known for her role at Go, which had been launched as a British Airways LFA subsidiary in 1998, and which was eventually bought by Easyjet in 2002.

 

QP describes Cassani as ‘founder’ of Go. In fact she was CEO, appointed by then-CEO of BA, Robert Ayling. Conveniently forgotten is that Go was losing money (about US$30mn in its last full year), although the blame for that was as much BA’s as Cassani’s.

 

QP says Cassani will “drive growth and development” of JI across Europe. She shows no particular skill for such a task, but this may be a mis-judgement of QP – whose purchase of JI from Jurys Doyle in June 2007 made no business sense either.

 

Before the JI purchase, QP has been involved in top hotels, owning some Four Seasons hotels as well as its own group based on the Claridges hotel in London.

 

An indication of the dysfunction is that QP describes JI as being in the “premium budget” sector. Such a sector does not exist; either JI is budget/economy or mid-market. Cassani compounds this misunderstanding, describing JI as “a premium brand”.

 

Has Derek Quinlan, head of QP, made his second mistake in the hotel business by buying JI? (His first was creating a big marketing task for the Claridges group by giving it an unknown name – Maybourne, still hardly known four years after the name was introduced.)

 

 

The Fox

Hotel brands. Armani label ripped off.

FOXTROTS

 

 

Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning. 

Foxtrots – leading the industry in a dance.

 

 

2008 September 17

Hotel brands. Armani label ripped off.

Following an initial agreement in 2004, fashion group Giorgio Armani and developer Emaar Hotels signed a contract in 2005 for the development of Armani Hotels & Resorts.

 

Due first was a 175-room Armani Q1 2008 in Dubai, homebase of Emaar, to be followed by “at least seven hotels and three resorts in the next 10 years”. After Dubai it was to be Milan, London, and New York, along with the first resort.

 

Now, Emaar has launched The Address as a brandname – yes – pitched at the top of the market. Due this year are two hotels in Dubai (and a third later). Others are planned – “…key cities and tourist destinations in the Middle East and North Africa, the Indian subcontinent, [rest of] Asia, Europe, and America [assumed North America] within the next 10 years”. Emaar says it already has “a significant footprint through mixed-use developments in central and strategic locales” in these places.

 

Cynicism comes easy:

[] As with Jumeirah, throw big-enough money and some progress will be made. But the field is getting crowded, and the public disinterested.

[] I think ‘The Address’ is a silly name for hotels, although with that Emaar is in good company – for instance, Hilton Hotels has ‘Waldorf=Astoria’, Starwood (Capital, not Starwood Hotels) has ‘1’ (that’s ‘one’), and Swire Hotels has ‘Opposite House’.

[] Emaar already plans “brand extensions” for its yet-to-start brand – Resort, Retreat, Urban, Business. But I am not quite sure how this can be implemented – The Address Urban Milan? The concept of brand extensions – I assume half a brand, half not – seems good but not for the public. Either it is a brand, or it is not; if it is not, don’t confuse the public.

[] Emaar suffers from delusions of grandeur. Its Vision 2010 calls for the company to become “one of the most valuable companies in the world”. I can confirm it has already achieved this, as have, by definition, all other companies. But if it wants to be, for instance, one of the 50 most valuable companies, then that might take more time.

 

 

The Fox

Capella & Solis. Schulze struggles.

FOXTROTS

 

 

Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning. 

Foxtrots – leading the industry in a dance.

 

 

2008 September 15

Capella & Solis. Schulze struggles.

The year after leaving Ritz-Carlton in 2001, its leader Horst Schulze formed West Paces Hotel Group, which in turn created two brands – Capella and Solis. He puts both at the top of the market, but with Capella higher.

 

Is it working?

 

Schulze still has high credibility from his RC times. He joined the company in 1983, eventually running it, but also presiding over its purchase by Marriott in 1995 – which he did not like to talk about. Even now, there is no official mention in West Paces documentation that RC is part of the Marriott group.

 

A previous owner of Ritz, the Atlanta-based W B Johnson real estate company (that made its big money from Holiday Inn and, er, pancake franchises), still has good relations with Schulze. And he actually started his West Paces company out of Johnson’s offices – which were in West Paces Ferry Road.

 

At RC, Schulze, aged 66 and born in Germany, was known to be rigorous about quality standards and maintaining them. Solis appears to be at a similar level to RC, but Capella has more of a ‘free spirit’ – which is not obviously Schulze’s strength. In fact, Capella is like Aman Resorts – and a market segment that is getting quite crowded.

 

The other ‘skills’ associated with Schulze are experience and contacts. Some of his hotels are owned by people who own or owned RCs.

 

After five years, the Solis portfolio is weak. It has two, Lough Eske in Ireland, and Cambrian in Switzerland, both existing properties; two others, in Jamaica and Florida, are late. Capella also has three open – in Austria, Germany, Ireland; it has seven projects – Ireland, Japan, Mexico (3), Singapore, US – but an unchanged list since the start of this year.

 

West Paces also has no-brand hotels.

 

 

The Fox

‘People are getting paid to do this’. Airport security checks.

 

FOXTROTS

 

 

Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning. 

Foxtrots – leading the industry in a dance.

 

 

2008 September 10

‘People are getting paid to do this’. Airport security checks.

Many now have their own stories on the oddities of security checks – either through their own experience or through those of fellow travellers.

 

These are mine:

 

[] France. Confiscated an empty plastic bottle. The security authorities refused to let this pass – because it is forbidden to take liquids on board. Note the facts – empty bottle…restriction on liquids.

 

[] Italy. Confiscated a boomerang. Okay, I suppose it is a weapon to someone with the right skills. But as I have said before, I could probably do more damage by hitting someone on the head with my portable computer.

 

[] Singapore. Confiscated a 3cm miniature spanner on a key ring. Admittedly it was real and not a souvenir. Were the authorities worried that it could be used to dismantle the aircraft in flight?

 

[] Thailand. Confiscated a second bottle, empty; the first was under the limit. Not quite sure why.

 

[] UK. Confiscated a retractable-toothpick. My argument – that if I tried to stab someone with the tiny blade (after all, this was for cleaning teeth), it would retract – did not impress.

 

 

The Fox