InterContinental Hotels Group
expanding in China with a new upscale brand
InterContinental Hotels Group PLC, owner of the Holiday Inn, InterContinental and Crowne Plaza hotel brands, plans to expand further with a new upscale brand in China and another midmarket brand in the U.S.
IHG executives spoke about their preliminary plans for the new brands while detailing the U.K.-based company’s second-quarter results on Tuesday. Those included a 6.5% gain in revenue per available room globally. More recently, IHG posted for July a revenue-per-room gain of 5.6%, including a 2.7% increase in the average rate.
Kirk Kinsell, president of IHG’s Americas division, spoke Tuesday with The Wall Street Journal about IHG’s quarterly results and its plans for the new brands. His comments here are edited for length.
WSJ: Is IHG seeing any impact on the travel industry and its hotels from recent global economic upheaval?
Mr. Kinsell: Generally, nothing is coming across that is suggesting to us that people are getting spooked and slowing down. Leisure travel, particularly in the last downturn, was very resilient and continues to be strong. (As for) corporate demand, for the most part, business profits have been stable if not growing. … There is a bit of noise in the larger markets in social business – banquets and catering that go into a hotel. We see a bit of softening in that. But otherwise, we have a great outlook for the months ahead.
Q: IHG already has 154 hotels in China, and now the company is planning a new upscale brand there. What will that entail?
Mr. Kinsell: What we’re looking at is the opportunity to serve primarily a Chinese traveler and the opportunity to dominate in terms of our overall share in the upper-upscale segment (there). … In some markets – Shanghai is a good example – we’ve got enough dots on the map in terms of Crowne Plaza and InterContinental. So having another brand in that space for different owners allows us to continue growing.
Q: When would you debut that Chinese brand?
Mr. Kinsell: We’d like it to be sometime in 2012, but it could push a bit further out.
Q: IHG already is the largest player in the midscale hotel market, with 2,664 Holiday Inns and Holiday Inn Expresses in North and South America. Why look to add another midmarket brand in the U.S.?
Mr. Kinsell: It’s the largest market in the world. With Holiday Inn and Holiday Inn Express, we dominate. This is an opportunity to leverage that position as well as to continue to grow with the size of the market.
Q: Will this new brand be a full-service brand with restaurants, pools and other amenities, or will it be limited-service like Holiday Inn Express?
Mr. Kinsell: From a guest experience, it would be full-service. That is to suggest that it will meet the needs of that traveling guest in that hotel. It would be something that would appeal to all elements of their travel needs.
IHG Chief Executive Richard Solomons talks through IHG's Interim Results for 2011:
Source:
WSJ
InterContinental Hotels Group PLC, owner of the Holiday Inn, InterContinental and Crowne Plaza hotel brands, plans to expand further with a new upscale brand in China and another midmarket brand in the U.S.
IHG executives spoke about their preliminary plans for the new brands while detailing the U.K.-based company’s second-quarter results on Tuesday. Those included a 6.5% gain in revenue per available room globally. More recently, IHG posted for July a revenue-per-room gain of 5.6%, including a 2.7% increase in the average rate.
Kirk Kinsell, president of IHG’s Americas division, spoke Tuesday with The Wall Street Journal about IHG’s quarterly results and its plans for the new brands. His comments here are edited for length.
WSJ: Is IHG seeing any impact on the travel industry and its hotels from recent global economic upheaval?
Mr. Kinsell: Generally, nothing is coming across that is suggesting to us that people are getting spooked and slowing down. Leisure travel, particularly in the last downturn, was very resilient and continues to be strong. (As for) corporate demand, for the most part, business profits have been stable if not growing. … There is a bit of noise in the larger markets in social business – banquets and catering that go into a hotel. We see a bit of softening in that. But otherwise, we have a great outlook for the months ahead.
Q: IHG already has 154 hotels in China, and now the company is planning a new upscale brand there. What will that entail?
Mr. Kinsell: What we’re looking at is the opportunity to serve primarily a Chinese traveler and the opportunity to dominate in terms of our overall share in the upper-upscale segment (there). … In some markets – Shanghai is a good example – we’ve got enough dots on the map in terms of Crowne Plaza and InterContinental. So having another brand in that space for different owners allows us to continue growing.
Q: When would you debut that Chinese brand?
Mr. Kinsell: We’d like it to be sometime in 2012, but it could push a bit further out.
Q: IHG already is the largest player in the midscale hotel market, with 2,664 Holiday Inns and Holiday Inn Expresses in North and South America. Why look to add another midmarket brand in the U.S.?
Mr. Kinsell: It’s the largest market in the world. With Holiday Inn and Holiday Inn Express, we dominate. This is an opportunity to leverage that position as well as to continue to grow with the size of the market.
Q: Will this new brand be a full-service brand with restaurants, pools and other amenities, or will it be limited-service like Holiday Inn Express?
Mr. Kinsell: From a guest experience, it would be full-service. That is to suggest that it will meet the needs of that traveling guest in that hotel. It would be something that would appeal to all elements of their travel needs.
IHG Chief Executive Richard Solomons talks through IHG's Interim Results for 2011:
Source:
WSJ
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