Hilton, Marriott impose cancellation fee
Business travellers have long been accustomed to being able to cancel a reservation at many hotels, without charge, as late as 6 pm on the day of arrival but, effective 1 January those days are gone at the two chains.
The companies say that if you don’t cancel your reservation by the day before your scheduled arrival, you’ll be charged a penalty of one night’s room rate.
In recent years, the airline industry has generated billions in revenue by charging fees on top of base fares. Now the hotel industry seems to be getting on the band wagon. Two worldwide hotel companies, Marriott and Hilton, have announced that they would increase their fee revenue by tightening rules on last-minute reservation cancellations.
“We’re making this change so we can provide you with a more consistent booking process and make more rooms available for when you need last-minute travel accommodations,” Hilton said in a statement.
Even hotels within large chains have varying cancellation policies, and the changes planned by Marriott and Hilton address only those last-minute cancellation rules. Policies won’t change for hotels that already have cancellation policies requiring a two-day, four-day or even longer advance notice. “Some hotels have more restrictive policies in place, so please refer to your individual conformations to verify their policy,” Hilton said
It’s likely that other hotel companies will adopt similar changes, especially as they evaluate the success airlines have had in raising additional fee revenue. For example, most airlines charge a fee to cancel and rebook most low fare tickets. Overall, airlines in the United States raised about $14.3 billion in ancillary revenue last year, according to an estimate by the consulting firm IdeaWorksCompany.com.
One trend driving accommodation providers to tighten cancellation policies is that cancellation rates have been rising. “Part of the issue is that business travellers are canceling more than they did previously,” Bjorn Hanson at the New York University Tisch Center for Hospitality and Tourism said.
Policies allowing a reservation to be canceled as late as 6 pm on the arrival date have been standard in many business hotels for more than a decade. But gradually, some hotels have been requiring more notice — and in some cases raising the cancellation penalty. While the penalty for canceling past the deadline is a single night’s rate at most city and suburban hotels, “at some resorts it might be three nights. And at some destinations it’s the entire stay,” he said.
