Isn't the current environment making Marriott more likely to offer mass enrollment to Vistana and Marriott owners?

[ocdb8r]

Sir, 10k includes blanket statements to offer the maximum flexibility to the company to do either, both or none. That kind of verbiage is copied/paste by lawyers that prepare some of these documents. It is utterly absurd to imply that Apple has bought 300 billion dollars worth of shares privately. I am not saying that these deals do not happen ever I am just saying that the preponderance is on the other side.

Danny - I've completely ceded the point so you can make yours...I'm wrong, you're right. Apple, VAC....they all make giant open market public share purchases. Now that we've gotten past that, please, explain how it's in any way relevant to the points you made in your opening post?

Like always, you offer no real sources, you are just trying to appear savant about the topic.

Again, I think those reading this whole thread have seen plenty of sources I have provided links to in order to back up every other argument I've made.

 

[DannyTS]

Danny - I've completely ceded the point so you can make yours...I'm wrong, you're right. Apple, VAC....they all make giant open market public share purchases. Now that we've gotten past that, please, explain how it's in any way relevant to the points you made in your opening post?



Again, I think those reading this whole thread have seen plenty of sources I have provided links to in order to back up every other argument I've made.

" they are drowning in losses" again, what was your source

 

[ocdb8r]

" they are drowning in losses" again, what was your source

Danny, again, please read post #12. I clarified this and apologized for any confusion if I wasn't clear when I originally used the phrase.

Do you have nothing to say about the original post in this thread? I don't understand why you're so fixated on small minutiae if you can't link any of it to your original argument...which you seemed to post as if you wanted other people to chime in. So sorry for making reasoned counterarguments to express my opinion on why this will not happen. If I made a mistake that creates a material flaw in the general thesis of my counter-argument, please, let me know.

 

[DannyTS]

Ok, it does not matter, you are right.

I think what is more important is that we see things differently on how things would play out if the company was cash strapped. I continue to believe that offering enrollment to a large base of the ownership can bring them a lot of money fast and that would be a very positive development for the company especially in a year like this one. Where I do agree with you is that dealing with cancellations and bringing forward a new program may be a bit more than the customer service dept can chew at once.

 

[ocdb8r]

Wait, maybe I understand my confusion. I read in another thread that if Marriott allowed access to the developer inventory they own, they would quickly go into insolvency.

Marriott pays the maintenance fees for the inventory it owns. They use it to rent, hopefully for a profit. You want to basically give it to you, it would put them in an insolvancy position pretty fast. Not to mention, if they own 5% of the inventory, that would not be sufficient to satisfy the other 95%

I'm not sure how that jives with the reality of where VAC get's their revenue. I also read they have 4 sources of revenue, and most of them are in pretty good shape. It's only this vacation sales segment some suspect is hurting.

@ocdb8r I encourage you to read the corporate investors day PPT presentation. VAC has 4 sources of revenue: management fees, exchange fees (Interval), sales of points and sales of vacations. The first one does not change whether people go or not to the resorts. The exchange business did not go down in 2008 and I would be surprised if it did today. More members may actually purchase Eplus and bring them additional revenue (marginally). I am sure the sales people are partly on commission and the earnings loss there may not be as much as you think. The vacation sales must be down big time, at least temporarily.

If the vacation sales business is already down big time, I'm not sure why allowing access to that inventory would push them into insolvency so quickly given how their other sources of revenue are doing. In any case, I didn't intend to make

alarmist statements

implying possible insolvency for something simple (like offering up access to their developer inventory). As I mentioned, I was referring to the losses seen in the share price, not anything material to their business.

Regardless, agreed:

I think what is more important is that we see things differently on how things would play out if the company was cash strapped. I continue to believe that offering enrollment to a large base of the ownership can bring them a lot of money fast and that would be a very positive development for the company especially in a year like this one. Where I do agree with you is that dealing with cancellations and bringing forward a new program may be a bit more than the customer service dept can chew at once.

We clearly see things differently. I didn't ever think they were cash strapped, never understood that if they were that they would make a quick rush to open enrollment to generate cash just to then use it to repurchase shares, and most importantly believe that the current environment gives management an excellent reason (pessimists might say excuse) for the business to be struggling, thereby removing any pressure to do something drastic outside the scope of what they believe is the best strategy as it relates to enrollment in whatever new program they're devising.

 

[DannyTS]

You had to go search another comment I made in another thread to justify the lack of support on the comments you made on this thread. Interesting.
About offering their own inventory to compensate owners who cannot travel now, I stand by my comment, it would be a bad business decision and a slippery slope. You have to know, there is a lot of pressure on them to do so but not only on the MVC side but people want something similar to happen if they cancel their Interval reservations. Marriott has an important inventory in terms of value but it is small compared to the overall ownership base. If they offered this to everyone that wanted to cancel, they would have no rental business for a very long time not to mention that they do not even own II inventory so they would have to give something they do not have.

My point is, let's say that they own 5% of the inventory and 75% of the owners decide to cancel in the next 4 months. They would deprive VAC from ALL rental revenue for the next 60 months while still shouldering all associated costs (their own MF) which could be huge. Not to mention, that inventory is not only rented for a profit, but also a source of potential buyers so it would be a double hit for them.

The difference between my statement and yours, hence your "confusion": mine was hypothetical in case they made a very bad business decision while yours was that it was happening now. But let's be honest, I do not think you read that comment before, you just went now to see what else I wrote.

Some Marriott owners think that we are literally drooling for a mass enrollment announcement. Not in my case, I have been extremely happy with what I own as well as with my trades and the internal MVC trading would be a huge drop in value for me. I may pay the enrollment fee for the fear of missing out but I am not so sure how much I would actually use it. The trades I have for this year for example would have cost me maybe 10k-12k in MF by using points. Using a combination of home reservations, StarOptions, and II exchanges, my cost is just a fraction of that.

 

[SueDonJ]

I respectfully disagree. If they offer enrollment for a $1000-$2000, to hundreds of thousand of Vistana and Marriott owners, they would make a lot of money especially if this a limited time offer.

Dan, I get the impression that you think Enrollment Fees have been prohibitively expensive and that all Marriott Weeks owners who did not enroll their eligible Weeks back in 2010 are currently locked out of the Destination Club. Neither is true.

Marriott IS CURRENTLY, since 6/20/10 and continuing to now, offering Destination Club-enrollment to owners of eligible Marriott Weeks. The original Enrollment Fee ranged between $595 for a single direct-purchase Week and $1995 for multiple external-resale Weeks, then was increased to a flat $2395. BUT there are incentives which substantially reduce or waive that fee - in many cases down to $0 - ZERO DOLLARS! - if those Owners invest a half-hour or so in watching "webinars" on the Owner Learning Center site. There are also periodic incentives that allow officially-ineligible Weeks to be enrolled simultaneously with the purchase of DC Trust Points. So for Marriott Weeks they are offering, and have been continuously offering, what you're proposing they should do in reaction to today's crazy market!

For Vistana Weeks it's apparent that *something* is in the works but none of us know what that something will be. I think most TUGgers - especially those who own VAC stocks - probably think that turning their existing model on its end would be foolhardy in the best of circumstances and much more so in today's crazy market. When they're ready they'll roll out whatever is in the works for Vistana Weeks, and again I think that most Marriott Weeks Owners aren't expecting that Vistana owners will be gouged like Marriott owners never have been.

 

[DannyTS]

Dan, I get the impression that you think Enrollment Fees have been prohibitively expensive and that all Marriott Weeks owners who did not enroll their eligible Weeks back in 2010 are currently locked out of the Destination Club. Neither is true.

Marriott IS CURRENTLY, since 6/20/10 and continuing to now, offering Destination Club-enrollment to owners of eligible Marriott Weeks. The original Enrollment Fee ranged between $595 for a single direct-purchase Week and $1995 for multiple external-resale Weeks, then was increased to a flat $2395. BUT there are incentives which substantially reduce or waive that fee - in many cases down to $0 - ZERO DOLLARS! - if those Owners invest a half-hour or so in watching "webinars" on the Owner Learning Center site. There are also periodic incentives that allow officially-ineligible Weeks to be enrolled simultaneously with the purchase of DC Trust Points. So for Marriott Weeks they are offering, and have been continuously offering, what you're proposing they should do in reaction to today's crazy market!

For Vistana Weeks it's apparent that *something* is in the works but none of us know what that something will be. I think most TUGgers - especially those who own VAC stocks - probably think that turning their existing model on its end would be foolhardy in the best of circumstances and much more so in today's crazy market. When they're ready they'll roll out whatever is in the works for Vistana Weeks, and again I think that most Marriott Weeks Owners aren't expecting that Vistana owners will be gouged like Marriott owners never have been.

it is not to be gouged, I never expected that to happen. A large base of potential new MVC owners and a fee that seems to be "fair" is the way to go IMO. I do not think it will be zero as you suggest "in many cases". But again this can be a cash generator for the short term that has long term benefits for everyone, I am not sure why you think this would turn the whole system upside down.

I agree with you though, they have shown discipline and they will implement whatever they think will benefit them in the long run.

 

[DavidnRobin]

This thread proves Danny has too much time on his hands.


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^^^^ This ^^^^


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