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“In terms of our business, COVID-19 is like nothing we’ve ever seen before,” Sorenson said. “For a company that’s 92 years old, that’s borne witness to the Great Depression, World War II, and many other economic and global crises, that’s saying something.”
The leader of the world's largest hotel company added: “I will not be taking any salary for the balance of 2020 and my executive team will be taking a 50% cut in pay.”
Hotel industry reeling from the shock
The hospitality industry has been crushed due to the coronavirus, or COVID-19, as occupancy rates plummet due to various restrictions.
“The principal change we face… the restrictions on travel, gatherings of people, and required social distancing is having an immediate impact by depressing demand for our hotels,” Sorenson said in the video message.
The stocks of major hotel companies are down due to coronavirus. Aside from Marriott, other major other hotel chains started closing locations and began furloughs or layoffs for tens of thousands of employees across the world.
U.S. hotel revenues per available room have declined more than 30% relative to how they were trending before the virus hit, for the week ending March 14, according to a recent note from J.P. Morgan, utilizing data from Smith Travel Research.
The week of March 8-14 this year, as compared to the week of March 10-19 last year also revealed a shocking decline, research from hotel data firm STR revealed. Occupancy rates had gone from 53% last year to -24.4% this year. The average daily rate for rooms has dipped more than 10%, and the revenue per available room has dropped by 32.5%.
Strain on the U.S. economy
The U.S. economy at large is showing signs of strain because of COVID-19’s impact on businesses.
In the meantime, beyond the steep decline in domestic and international travel, many Americans are scrambling to find ways to stay afloat after losing their jobs.
Aarthi is a writer for Yahoo Finance. She can be reached at firstname.lastname@example.org. Follow her on Twitter @aarthiswami.