Skift Travel News Blog

Short stories and posts about the daily news happenings around the travel industry.

Online Travel

Trip.com Group Taps $1.5 Billion Loan Tied to Green Targets

12 months ago

Trip.com Group said on Friday it had tapped a $1.5 billion sustainability-linked loan facility, meaning that the financing terms link the debt’s interest rates to the Chinese online travel giant’s performance against specific environmental targets.

The Shanghai-based company will use three-year dual-tranche term loan facility to refinance some of its debt, and the rest for general corporate purposes.

The move appeared to be the first time a major online travel player adopted green finance. Last year, a shareholder initiative prodded Booking Holdings to do a climate change report. The report came out this year. In October, the company said its Booking.com brand would add emissions estimates to bookings soon. Trip.com-owned Skyscanner has estimated flight emissions for consumers for a few years.

Climate-related risk is on investors’ minds as they look at their portfolios. For travel in general, the sustainability-linked bond may provide more flexibility for investors worried about this issue, said Leslie Samuelrich, president of Boston-based Green Century Capital Management. Sustainability-linked bonds are different from green bonds. They set macro targets for a company, while green bonds commit to specific projects.

The investment concept is growing fast, Samuelrich said. Last year, lenders issued $103 billion in sustainability-linked bonds to companies across various industries. The year before that, it was about $12 billion.

In April, Ascott Residence Trust issued a sustainability-linked bond — apparently the first in the hotel sector — worth about $143 million ($200 million Singaporean). Ascott Residence Trust has committed to a sustainability performance target of greening half of its total portfolio by 2025, and its interest rates would essentially rise on the loan facility if it fails to meet the target.

The process remains murky and slow burn, though. There’s a debate about measuring the greenhouse gas emissions contributing to the climate emergency. IFRS Foundation, the international accounting standards-setting body, has this year been working on setting standards for emissions-focused reporting. Their work, and the work of other organizations, will adjust how investors evaluate climate risk — a knotty task inviting skepticism from some critics.

Side note: Trip.com’s chief commercial officer Schubert Lou will talk about the international division of Trip.com Group at Skift Global Forum East in Dubai on Dec. 14.

Tourism

UK Tops European Hotspot List for U.S. Travelers

1 year ago

American tourists are flocking to the UK over other European destinations, new data shows.

Post-Covid pent-up demand has collided with the strong dollar, according to the latest figures from travel agency Trip.com, with a 678 percent surge in searches for U.S. to UK flights in the first six months of 2022, compared to the same period last year.

Overall, its inbound transatlantic booking data showed actual bookings from the U.S. to Europe increased 246 percent.

Booking values are up by 37 percent.

Spain came a close second regarding consumer interest, with a 614 percent increase in flight searches from the U.S., followed by Italy (577 percent) and France (491 percent.)

Trip.com’s Americas chief said travelers appeared to be taking advantage of the weaker European currency.

“We believe the increased value of the strong U.S. dollar versus the weaker euro and fall in the value of Pound Sterling means that US travelers have so much more buying power in Europe, which has helped to mark the continent’s return once more as a major destination for the U.S. market,” said Rich Sun, Trip.com Group’s general manager for the Americas.

The difference in value translates to a 10-15 percent discount, compared to the same time last year.

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