“I think it's pretty clear to me and most that we need additional stimulus to the economy, period,” Nassetta said in an interview that aired as part of Yahoo Finance’s All Markets Summit on Monday.
Nassetta is one of more than 75 hospitality CEOs including those from Hyatt (H) and Marriott (MAR) who wrote President Donald Trump earlier this month urging for immediate action to help the industry. The letter asserted that three out of every 10 hotel employees are now furloughed, and that more than two-thirds of hotels say they can only operate for six months on current projected revenue.
“This health and economic crisis has wreaked havoc on hotels in our industry, of which 60% operate as small businesses and nearly 50% are minority owned,” the letter stated.
As strongly as Nassetta believes stimulus is necessary, he’s accepted that it may not happen before Election Day on Nov. 3. He told Yahoo Finance, “I don't know if anything's going to get done pre-election... I'm pretty optimistic that regardless of who wins in the upcoming election, that we're going to get something done that will be sensible. The American people need it. The economy needs it. Our industry needs it, as do other industries.”
‘Airline business is critical’
Within the travel and leisure ecosystem, one segment that Nassetta believes is essential for hotels to return to pre-pandemic levels is air travel. This summer and fall, Nassetta says the pick-up in bookings has tilted to drive-to destinations. If you look at travel patterns for Hilton in the past and expectations for future growth though, Hilton’s business is based to a large extent on people arriving on planes.
As airlines from American (AAL) to Delta (DAL) to United (UAL) face cutbacks, the hotel business is impacted by those very same schedule changes. Nassetta says, “Leisure travelers have started to come back, but business and meeting travel is still dragging. One issue the hotel operators face is how to get business back to pre-pandemic levels when flights have been substantially reduced across the board.”
As the CEO of a hotel company, Nassetta sees the importance of a robust airline industry, but robust mobility is larger than just getting his business back — he sees it as a key to larger economic expansion.
“Airline business is critical and important infrastructure for our industry. My belief is critical infrastructure to the country, in terms of being able to move people, give people the mobility to conduct business, to do the things that they want to do in their lives, and ultimately, to allow for commerce to be conducted.”
Jen Rogers is an anchor for Yahoo Finance. Follow her on Twitter @JenSaidIt.
More from Jen: