Intercontinental’s rebranding of its Holiday Inn chain is facing a revolt by hoteliers in China over the cost of the US$1bn overhaul.
The rebranding is scheduled to be completed by 2010 and is taking place across all 3,000 plus of Holiday Inns around the world, which IHG mainly manages rather than owns. It is investing US$60m towards the programme, with individual owners footing the rest of the bill. Chinese hoteliers are calling for a delay due to tight cash flow. According to The Independent, Martin Jia, the head of the IHG hotel owners association in China, said that some of his members were seeking to delay the rebrand because of the financial downturn.
“Some of the association’s members believe that the period for rebranding is too short and we will ask Intercontinental’s management if the period for completion can be delayed for one or two years,” said Mr Jia.
“The rebranding programme was launched in 2007 before the financial crisis really began. With Intercontinental asking hotel owners to cut costs, coupled with falls in cash flows because of the crisis, I think a delay to the programme may be appropriate.”
An IHG spokesman said: “It is our job to ensure hotel owners understand the benefits of the relaunch and the improved financial performance and customer satisfaction it will bring.”
IHG operates around 100 hotels in China, with another 100 in the pipeline. This, China overtook the UK to become the group’s second-most important market after America.