Green Hotels

Green Travel Trends, Pt. 2

Written by Brian Hicks
Posted June 5, 2008

First off this week, I want to thank those of you who put your two cents in about my column on energy efficient transportation and how higher oil prices are squeezing companies and consumers alike.

I love to see comments like the one here from Captain Lindsey Powell, who flies a Boeing 757 for a living. Lindsey gave us a pilot's-eye-view on air travel, with the most current numbers you'll find.

"As a Captain of a Boeing 757, this week I flew 180 people from Washington to LAX. We burned 26,000 pounds of fuel (3,800 gallons) at a cost of about $14,000 total fuel bill. This equates to $78 per person for fuel. Another $1 per gallon would add another $21 per person each way on this full flight.

Compare this to driving the 2600 miles alone, you would have to get over 100 mpg to burn the same 21 gallons per person.

It's still an efficient, albeit stressful, way of travel."

Thank you so much for your input, Lindsey. It's one thing to write about market movements, but it's quite another to get the scoop from the cockpit.

If you want to make a point about a Green Chip Review article that hits close to home, please avail yourself of the "Comment on this Article" link right at the bottom of this page.

Now, on to this week's topic: green hotels... where we look at travel from a different angle.

The Push Toward Green, Energy Efficient Hotels

If taking a vacation meant nothing but traveling, no one would go. Time spent in on plains, trains and automobiles takes its toll on the body and mind, and by the time you get from point A to point B you just want to kick back and relax.

But the fact is that even when you're lounging around on the beach or sweating out your stress at a spa, energy plays a role in your holiday.

Like airlines, hotel chains are facing stiff headwinds.

  • Consumer confidence is down and fuel costs make vacations prohibitively expensive for many
  • Energy costs for facilities—especially ones with low occupancy—are squeezing margins

Oppenheimer Funds just downgraded three major hotel chains based on the above factors and relatively weak international growth to balance a U.S. slowdown.

Marriott International (NYSE:MAR), Choice Hotels International (NYSE:CHH), and InterContinental Hotels (NYSE:IHG) were all moved from "outperform" to "perform" on June 4.

So in the near term, these companies' stock prices may trade within a range dictated by how well they can surmount profit obstacles. The long-term picture is good, though, for ones that establish comparative advantage in energy and water efficiency.

Going Green: Why Every Water Drop Counts in Hotels 

If you've stayed in a hotel recently, you may have seen a new note hanging next to the classic "Do not disturb" tag.

Many major hotel chains are now gently encouraging guests to reuse towels to cut down on water for laundry use. If a towel is too soiled to reuse, toss it on the floor. If not, hang it on the door to dry.

Hotels are also purchasing front-loading washing machines, which use 40% to 60% less water and between 30% and 50% less energy than top-loaders.

You can imagine the reduced headache this leads to for resort managers in U.S. dry spots like Las Vegas, and internationally at Dead Sea resorts in Jordan and Israel.

Though Memorial Day travel volume seemed robust here on the American east coast, the colliding threats of recession and inflation mean the time to make efficiency investments and stay competitive is now.

Marriott International has plans to reduce energy and water usage at its hotels and resorts by 25% in coming years. Marriott is also installing solar power units at 40 of its hotels, with more such improvements to follow.

Outside the suites, Marriott inked a deal in April with Brazil's Amazonas Sustainable Fund to donate $2 million for the protection of 1.4 million acres of rainforest.

That points to a separate but important effort by executives to appeal to green consumers. by building a brand tied to corporate social responsibility.

There are also a plethora of smaller hotels that, being more nimble and not having to roll out efficiency measures or buy devices for dozens of buildings, have joined the Green Hotels Association to tie travel to a zero-carbon lifestyle.

You can find a list of these hotels, motels, and other inns at

As for the big boys and stock buys, Marriott (NYSE:MAR) looks appetizing right now considering its efficiency enhancements. It's trading near three-year support levels just above $30, and even though Marriott's Q2 revenue-per-room forecast was recently revised downwards by 2-3%, we should see recovery by 2010.

What are you looking for in green travel trends? Let us know.

Happy trails to you,


Sam Hopkins

P.S. - In the Green Chip International portfolio we're not just looking at energy producers but companies that play smart with power, in travel, food, or whatever industry you can think of. Fact is, energy prices impact it all, and first movers will be the ones who survive the shakeout. To learn more, join GCI today