Cendant To Revamp Its Reorganization: Plans To Cut Hotels, Jobs

PARSIPPANY, NJ— About a year after beginning its initial corporate restructuring, Cendant Corp. reported plans to trim as many as 300 hotels from its franchise system in an effort to eliminate substandard properties, the Wall Street Journal reported. As part of the cuts, Cendant will lay off 75 of its employees in the lodging division and not fill an additional 55 positions. According to reports, Cendant expects to purge about 7% of its 6,100 domestic hotels across nine brands, which include Days Inn, Super 8, Travelodge, Villager, Knights Inn, Wingate Inn and AmeriHost Inn. Steven Rudnitsky, who was appointed chairman and chief executive of the hotel group earlier this year, said after a review of the companys franchisee portfolio, he discovered certain quality standards had slipped across the system. Although the company routinely eliminates franchisees, representing between 20, 000 and 30,000 hotel rooms each year, this latest initiative will boost that tally by another 40,000 rooms. The company sent out notices to the 300 hotels on Aug. 16, and the owners have 10 days to respond with suggestions of how they might meet the companys standards. Issues addressed included: the installation of electronic key locks, towel thickness, carpet wear and tear, and how the reservation desk handles customers. The move comes after Cendant reported an 8% decline in RevPAR in the second quarter 2002. SOURCE: Wall Street Journal