MGM Resorts CEO on Las Vegas stoop and U.S. journey

Las Vegas is launching a brand new marketing campaign to spice up tourism after a big summer time stoop.

The new marketing campaign, “Welcome to Fabulous Las Vegas,” will give attention to worth for guests and supply promotions and different incentives on the vacation spot.

The metropolis has seen visitation decline for seven consecutive months, with the latest report from July exhibiting a 12% decline 12 months over 12 months.

And but, MGM Resorts CEO Bill Hornbuckle says, “Las Vegas is not done or dead.”

“To the contrary, I think there’s lessons to be learned, you know, in terms of value and value creation,” Hornbuckle instructed CNBC Thursday on the Bank of America Gaming and Lodging Conference.

Hornbuckle stated affordability and perceptions of worth have been particularly top-of-mind for budget-conscious guests. He pointed to the offers out there on the Excalibur, one among MGM’s resorts on the Las Vegas Strip: $85 rooms, together with resort payment; $5 tables; $5 beers. But the $12 Starbucks espresso grabs the headline.

“There is value there, and there’s always been value,” Hornbuckle stated. “We let the narrative get away from us and shame on us. We need to do a better job.”

MGM and Las Vegas extra broadly had posted a number of years of development in visitation, room charges and earnings earlier than this 12 months’s slowdown.

When requested whether or not the Vegas stoop might be a canary within the coal mine for U.S. journey extra broadly, Hornbuckle, who chairs the U.S. Travel Association, stated it does appear to be a number one indicator. And the trade as an entire is going through some troubling obstacles.

Canadian visitation to the U.S. has plummeted some 40% this 12 months, following feedback by President Donald Trump about Canada as a possible 51st U.S. state and evolving commerce insurance policies. The Canadian greenback has additionally weakened, lessening the shopping for energy of tourists crossing the border into the U.S.

Hornbuckle additionally pointed to huge value hikes for a U.S. visa, from $100 to $350, the place a household of 4 visiting for the Ryder Cup, World Cup or Olympics in 2028, for instance, might pay $1,400 for visa paperwork alone.

“International travel in 2016 had a $50 billion U.S. surplus. Today it’s a $50 billion deficit,” Hornbuckle stated.

The authorities’s dedication to funding advertising and marketing and promotion of U.S. journey was additionally slashed by 80% in the latest spending invoice, to $20 million.

“We obviously find ourselves in a world that has a fair amount of uncertainty from a macroeconomic perspective, from a socio-political perspective,” Marriott CEO Tony Capuano instructed traders on the BofA convention Thursday. “Marriott, and the sector more broadly, thrives in times of certainty and stability. So that creates some measure of challenge.”

Capuano stated there’s been a slight uptick after Labor Day in some segments of journey. He stated Marriott sees spending restrained in price range vacationers and small companies. But he described demand for luxurious journey as “sturdy.”

Wyndham Hotel and Resorts CEO Geoff Ballotti laid out an optimistic view of the journey trade, noting strong demand for prolonged keep, pushed partly by initiatives supporting the federal government’s infrastructure spending.

“You’re seeing incredible interest in investment right now,” Ballotti instructed CNBC. “Our new construction pipeline, 20 consecutive quarters of growth, is at an all-time high. We’re seeing groundbreakings accelerate. We’re seeing a new construction pipeline accelerate, and we’re seeing it more so here domestically than we are anywhere else in the world.”