How tariffs are challenging U.S. hotels

Richie Karaburun, professor at NYU's Jonathan M. Tisch Center of Hospitality, shared his concerns about the impact of tariffs on the U.S. hotel industry

While the hospitality sector continues to grow with new hotels, acquisitions, and expansions, the introduction of tariffs is expected to increase operational costs and hinder future development. This, coupled with shifting visa regulations and safety concerns, could create significant challenges for hoteliers.

Key takeaways

• Impact on costs: Tariffs could increase the cost of essential hotel imports, such as linens, towels, and housekeeping supplies from countries like Vietnam, Cambodia, and Indonesia.
• Increased construction costs: The cost of materials for new hotel construction will rise, potentially slowing down the development of new hotels.
• Limited flexibility for smaller hotels: Large hotel chains like Marriott and Hilton may have the buying power to absorb the increased costs, but smaller hotels will face more difficulties.
• Increased consumer uncertainty: The combination of tariffs and media coverage about safety concerns may decrease consumer confidence, especially as the stock market fluctuates.
• Uncertainty for the future: While the long-term impact is uncertain, the situation could affect both daily operations and future growth for many in the hospitality industry.

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