By Melissa Wiley /
February 12, 2020
Hilton Wuhan Optics Valley Hotel
Credit: Courtesy of Hilton

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On Tuesday, Hilton CEO Chris Nassetta announced on an earnings conference call with investors that the brand has temporarily closed 150 hotels in China, totaling 33,000 rooms, until the novel coronavirus outbreak subsides.

"Hilton has temporarily closed approximately 150 hotels in China at the direction of local authorities," Nigel Glennie, Hilton's VP of Corporate Communications, told Business Insider in an email. "Some of these hotels are still housing existing guests and medical professionals, but they are not accepting new reservations at this time. We will look to re-open these hotels as soon as possible and once the local authorities confirm that is appropriate."

Hilton has four hotels in Wuhan, 225 in Greater China, and 6,110 in its global network across 119 countries and territories, Glennie said.

Nassetta told investors on the call that China represents 2.7% of Hilton's EBITDA (earnings before interest, taxes, depreciation and amortization), and estimates that if the corona virus impact and recovery time lasts between six and 12 months, Hilton could see a $25 million to $50 million impact on its 2020 earnings.

The announcement makes Hilton the first major hotel chain to announce the estimated financial impact of the outbreak on its earnings, Nancy Trejos reported for travel industry news site Skift.

On January 30, the World Health Organization declared the coronavirus a "public health emergency of international concern." To date, the coronavirus has infected over 45,000 people worldwide and claimed over 1,100 lives.

The coronavirus is predicted to have a multibillion-dollar impact on the US travel industry, Keiko Morris and Austen Hufford reported for the Wall Street Journal. According to travel economists, the hotel industry could lose 4.6 million overnight stays in 2020 as a result of the outbreak, and in total the industry could lose as much as $5.8 billion, Morris and Hufford said.

Hilton joins a growing list of hotels that are closing down branches and revising policies related to bookings in China. Best Western CEO David Kong told Skift on Monday that the company has also had to close "many" branches in China, and hotel brands including Hyatt, Marriott, IHG, and Wyndham have lifted change and cancellation fees in affected areas, Greg Wallis reported for Hotel News. Airbnb has enacted its "extenuating circumstances policy," allowing guests to cancel reservations in affected areas at no charge.

Over 73 airlines, including American and United, and many cruise ships have also restricted travel to and from China during the outbreak.