Amex-Avios Deal Extends; Marriott-Sonder Partnership Collapses
The article highlights two significant developments in the travel and loyalty sectors. First, IAG Loyalty and American Express announced a multi-year extension of their credit card partnership. Despite the length of the official statement, specific details regarding the contract's duration, headline terms, or the introduction of new products or benefits were notably absent. The only concrete update provided was that LEVEL, IAG's budget long-haul airline, now accepts American Express, addressing a previous gap. It was also suggested that competitor Barclaycard did not bid against American Express for this renewal.
The second, more dramatic, development involves the abrupt collapse of Marriott's licensing agreement with Sonder, an operator of apartment-style accommodations. In August 2024, Marriott had entered a 20-year deal to integrate approximately 200 Sonder properties, encompassing 9,000 rooms, under the ‘Sonder by Marriott Bonvoy' brand. This arrangement was initially framed as Sonder's critical lifeline to avoid bankruptcy, aiming to leverage Marriott's extensive sales system for increased occupancy and room rates, in exchange for a $15 million signing fee and royalties. Sonder's portfolio, including 16 London buildings, was designed to appeal to younger travelers and those seeking longer stays through a digital-first operating model.
However, the partnership quickly dissolved. Around 150 Sonder hotels previously integrated into Marriott's system were swiftly removed from its website, with bookings no longer possible via either Marriott or Sonder's own platforms. The situation escalated to future bookings being cancelled and, particularly in North America, guests reportedly evicted mid-stay, accompanied by widespread staff layoffs. Sonder is now anticipated to seek bankruptcy protection. This failure reduces Marriott's brand portfolio from 37 to 36, although the article speculates that Marriott or other major chains might still consider acquiring Sonder's underlying holding company.
