Hotels express mixed feelings about holidays

Hotels express mixed feelings about holidays

Unequal access to big spenders a worry

A lone tourist walks on a beach in Pattaya. Purchasing power is a concern for domestic tourism. (Photo by Wichan Charoenkiatpakul)
A lone tourist walks on a beach in Pattaya. Purchasing power is a concern for domestic tourism. (Photo by Wichan Charoenkiatpakul)

Hotel operators embraced the additional holidays in the fourth quarter announced on Tuesday by the cabinet but raised concerns about unequal opportunities for hotels in different tiers.

The four-day weekends added to the calendar for Nov 19-22 and Dec 10-13 are part of efforts by the government to support domestic tourism during the high season.

Marisa Sukosol Nunbhakdi, president of the Thai Hotels Association (THA), said the additional holidays will help operators in long-distance destinations, particularly northern areas famous for winter excursions.

According to a tourism survey conducted by the THA, the average occupancy of hotels during previous long holidays was 20-30% higher than on weekdays and weekends. Some properties gained 40% more occupancy because they were located in popular destinations for locals.

As Thailand has had a few long holidays in recent months, hotel operators are mostly concerned about purchasing power. Those who still have strong demand for repetitive trips are in the high-income segment and have a tendency to choose five-star or luxury hotels.

Taking long-distance trips also means tourists have to spend more on air tickets -- conditions supporting only those who still have the ability to pay for leisure activities without financial concerns.

"When luxury hotels have more affordable prices after enrolling in domestic stimulus campaigns, tourists who still have strong purchasing power will pick these hotels first," Mrs Marisa said.

She said the THA would like the government to provide benefits that bring in the middle- to lower-end segment and create equal opportunity for operators.

Most hotels are facing stiff competition because they have to aim for the same single market, local travellers.

They will also be affected when fiscal budget spending is delayed from October. Government meetings and seminars are an important source of revenue as international tourists remain absent.

"Hotels should have higher bookings from state agencies for October, but the delayed budget has stagnated this segment," Mrs Marisa said.

She said the number of hotels reopening in the fourth quarter won't be significantly higher than in this month. Hotels that are open cannot expect profits yet.

The THA's priority is requesting that the Finance Ministry extend the debt moratorium period, as the vast majority of hotels still have poor debt-servicing ability.

Mrs Marisa said the ultimate solution to help the industry is to set up a tourism fund so that hotels can use their shares as a loan guarantee and buy back those shares when the business returns to profit.

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