If there is one thing French hotel company AccorHotels could never be accused of, it's being boring. In two meetings this week, the Paris-based conglomorate made it known that it's going to set a blistering pace this year in a quest for greater market share and worldwide dominance. In short, it has no intention of letting any U.S. hotel company gain greater market share in Europe. Ever. Period.
First, let's get to the company's eye-opening announcement that Nicolas Sarkozy, the former president of France, will chair AccorHotels' newly formed International Strategy Committee, which will focus on the development of the chain's network and brand portfolio worldwide, as well as the "promotion of French tourism."
Sarkozy, who was president from 2007 to 2012, tried to make a comeback last year but was defeated in his party's primaries. "I am glad to contribute to the development and the international reach of AccorHotels, one of France's flagship companies," Sarkozy said in a statement. Didn't see that coming!
Barely a day later, at its 2016 Results analyst conference call, Sébastien Bazin, right, chairman and CEO of AccorHotels, ran down the company's year-end performance milestones, such as snapping up Fairmont Raffles Hotels International Group's luxury portfolio of 159 hotels, 39 of which are under development; its majority-share acquisition of John Paul, a world leader in concierge services; and the launch of its new lifestyle brand, Jo&Joe, last September.
The numbers were equally impressive: 347 hotels were added to AccorHotels' portfolio in 2016, representing more than 81,000 rooms; net profit was up by 8.1 percent year-over-year; and a red-hot pipeline in Asia Pacific saw 70 hotels signed in China last year alone, with another 150 in the pipeline for the region.
"A number of people ask me, 'Do you think that Accor's brands still have sex appeal?'" said Bazin. "People love to knock a brand. Well there is no better answer to that question than to say, 'Do you think people would entrust me with $150 million every 36 hours for a brand that has no sex appeal?' Because that is the dollar amount of the hotels we have opened over the last 12 months."
Bazin acknowledged that business had been challenging in his company's home country, and in Paris in particular, primarily because of terror attacks and the continued climate of uncertainty. Revenue in 2016 was down by 2.8 percent in France compared with 2015 (though up by 0.9 percent overall), while RevPAR dropped by 13.2 percent. "France and Central Europe is where we are growing the slowest," he acknowledged, but added, "We have 300,000 rooms in Europe, and that's more than our American counterparts combined."
To reinforce his point that AccorHotels is determined not to cede any home ground to foreign hotel companies, Bazin flatly declared, "Nobody will be taking over from Accor in terms of market share in Europe." Marriott International, are you listening?