Marriott International CEO has warned there will be job cuts at the “executive suite” of Starwood, following the recent mergers between the two hotel groups.
Arne Sorenson said Starwood has been spending $400-500 million a year in overheads and job cuts will be made in order to find the targeted $200 million a year in savings.
Speaking to Fox News Sorenson said these will be at the corporate level not “property level jobs”.
“The closer you get to the executive suite in the two companies headquarters, the more you see a head-to-head overlap,” said Sorenson. “We don’t need two CEOs, we don’t need two general councils and we don’t need two boards of directors. So the biggest cost savings will be in the higher end of the overhead structure.”
Following last month’s $12.2 billion deal, Marriott will now operate or franchise more than 5,500 hotels with 1.1 million rooms worldwide.
Sorenson said: “The size of the company will give us the ability to invest in our eco system, think about the Marriott rewards programme and the SPG programme. Two of the strongest loyalty programmes and we can make them stronger by aligning them together.”
He added that the business travel market will continue to be “steady” in 2016, despite there being “anxiety in the market”.
“I would say anxiety today is more than this time last year, which could have an effect on how corporate customers book for next year, but we will see how that plays out,” he said.
Read BBT’s interview with Sorenson here
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