Impact of visa exemption expected to be delayed

Impact of visa exemption expected to be delayed

Mr Srettha, right, meets Mr Wang at the Government House on Monday.
Mr Srettha, right, meets Mr Wang at the Government House on Monday.

Even with a permanent visa-free policy between Thailand and China, air ticket prices are not expected to immediately surge as demand will pick up gradually, while seat capacity has yet to fully recover.

Hotels also don't expect large tour groups to flock to Thailand as in the past.

China's Foreign Minister Wang Yi met Prime Minister Srettha Thavisin on Monday as part of a four-day official visit, during which the permanent visa-free pact between China and Thailand was concluded.

Wutthiphum Jurangkool, chief executive of Nok Air, said after the Thai government announced earlier this month the permanent visa exemption from March 1, there has not been a spike in bookings as Thai tourists waited for a clear announcement from Beijing.

He said the inbound Chinese market remains unpredictable as the average load factor during Chinese New Year surged to 90%, but forward bookings after the holiday are still quiet.

Prior to the pandemic, he said the airline operated to 10 cities in China. Including charter flights, it previously served almost 30 cities.

This year, Nok Air is operating flights to only three cities in China, comprising Chengdu, Zhengzhou and Nanning.

A Chinese tourist takes a selfie with Prime Minister Srettha Thavisin during a welcome ceremony of the first batch of Chinese tourists under a visa-free entry scheme at Suvarnabhumi Airport on September 25, 2023.

Nuntaporn Komonsittivate, head of commercial operations at Thai Lion Air, said the average airfare for China routes would not drastically change due to the reciprocal visa waiver as demand among Thai tourists might gradually increase.

She said normally Chinese passengers accounted for 80% of flights to the mainland, while local travellers made up 20%.

With the mutual visa exemption, the share of the Thai market for Thai Lion Air's China routes might rise to 25% at the start of this scheme, before surging again during the school holiday period.

"Since the Thai government announced this policy in the first week of January, travel bloggers in Thailand have consistently promoted many Chinese destinations on social media, but that didn't lead to bookings as travellers waited for clarification of the policy from both governments before planning their trips," said Ms Nuntaporn.

She said the average price of airfares on Chinese routes were not as expensive as during the lockdown period since many airlines are expanding their services.

However, the most popular destinations might be concentrated among cities that have convenient transportation.

Ms Nuntaporn said in terms of the price range, tour packages to China might be close to Hong Kong and less expensive than travelling to South Korea or Japan.

HOTELS COOL ON MASS TOURS

The permanent free-visa scheme between Thailand and China may not immediately boost Chinese tourist numbers during the low season due to the mainland's weakened economy, according to hotel operators.

"The move may only create ease of travel and will encourage Chinese to choose Thailand, but they won't come in a large volume as before," said Suksit Suvunditkul, president of the southern chapter of the Thai Hotels Association (THA).

The mainland's sluggish economy, stock market meltdown and its flourishing domestic travel are critical factors stalling market growth.

Phuket hotel bookings for Chinese New Year week remain steady with a mixed market, including China, India, Russia, Australia, the UK and Kazakhstan.

Aligned with the island's high season, hotels should see the average occupancy rate during the festival week and February surging to 86-90%, said Mr Suksit.

He said many Chinese tourists regard Phuket's hotel prices during high season as expensive, so they tend to wait for the cheaper period in March and April.

Boonkerd Suksrikarn, vice-president of THA's eastern chapter, said the Chinese-speaking markets, including China, Hong Kong and Taiwan, have become less dominant during the Chinese New Year for Pattaya, compared to the corresponding period before the pandemic.

The market share of Chinese-speaking markets during the holiday this year dropped from 40-50% in 2019 to 20-25%.

Other markets such as India, South Korea, Europe and the Middle East have emerged as rising stars for Pattaya.

Mr Boonkerd attributed this to the changing behaviour of the Chinese who now travel in smaller tour groups or as independent travellers.

Hotels which focused on tour groups in the past could not resume operations until now.

He said Pattaya hotels should see a robust occupancy rate in February at 90%, up from 75-80% in the same period last year.

Paisarn Sukjarean, president of THA's northern upper chapter, said Chiang Mai expects fewer Chinese tourists during Chinese New Year compared to other tourist destinations like Phuket and Bangkok due to fewer flights and lower demand.

Mr Paisarn said many hotels have pivoted to domestic tourists, along with guests from Europe and South Korea.

Despite a better flow of Chinese arrivals, Chiang Mai hotels still won't see strong forward bookings from March, after the Lunar New Year ends.

"Foreign travel agents, including the Chinese, hesitate to book their trips because of the smog season in Chiang Mai which is normally concentrated in March and April," he said.

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