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Lack of flights, rising fuel costs mar revival

Lack of flights, rising fuel costs mar revival

BUSINESS: Insufficient inbound international flights and surging airfares are challenging the recovery arc for the Thai tourism industry as the country pins its hopes on the upcoming high season in its quest to welcome 10 million tourists this year, according to the Tourism Authority of Thailand (TAT).

tourismRussianUkraineCOVID-19
By Bangkok Post

Monday 4 July 2022, 09:01AM


Foreign visitors queue to check in for their flights at Suvarnabhumi airport. Photo: Somchai Poomlard

Foreign visitors queue to check in for their flights at Suvarnabhumi airport. Photo: Somchai Poomlard

TAT governor Yuthasak Supasorn said the number of international flights stands at only 30% of the pre-pandemic level. He said to help revive the whole industry, the country should have at least 55% of the airline seat capacity recorded prior to the pandemic, which could happen during the fourth quarter as Korean Air and Air Canada have confirmed their schedules for non-stop services, reports the Bangkok Post.

Air Canada plans to commence its first direct route from Vancouver to Bangkok with four flights a week using Boeing 787 jets from Dec 1, 2022 until Apr 17, 2023. Korean Air made a commitment to the TAT during its recent visit to Seoul that it would resume flights to Thailand in the fourth quarter.

However, many airlines are reluctant to expand their routes or increase frequencies as several global uncertainties threaten profit prospects, including hefty operational costs caused by soaring fuel prices as well as the longer flying time required to avoid the skies above the Russian-Ukraine combat zone.

“Tourists face higher travel costs, particularly from inflation and airfares, which have increased by 20-40%. The TAT is working with airlines, both scheduled and chartered services, to roll out joint promotions to help offset those costs. However, for Europe’s summer season in August, it might be too late to prepare any stimulus packages,” said Mr Yuthasak.

Hotel operators indicated the average occupancy rate should reach 55% to benefit the whole supply chain, but the current flow of tourists is not strong enough to persuade more hotels to reopen and bring back their employees.

CBRE Phuket

According to the Tourism Council of Thailand (TCT), the average occupancy rate in Thailand stands at 34%, while 80% of properties have revenue of less than 50% of the level recorded before the pandemic.

Chamnan Srisawat, president of the TCT, said a labour shortage could be a major hindrance during the upcoming high season if arrivals do reach government targets.

He said hotels that need to recruit more workers will find hiring difficult if offering similar wages as before, given inflation, the likelihood of a higher minimum wage this year, and the insecurity of hospitality jobs.

Mr Chamnan said companies and the TAT are joining to offer a “Booster Shot” project along with the Centre for Economic Situation Administration, aiming to create a million jobs in the tourism sector this year by offering airline seats and room nights in smaller hotels with discount prices.

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Kurt | 08 July 2022 - 11:32:17

USA, UK, European airports are reducing flights with up to 30% due to shortets of pilots, cabin crew, airport security- and luggage handlers air airports. Ticket prices also changing now rapidly due to lesser flights ( so more pressure seat demand), rise in kerosine prices. Seems Thailand just ignores the global setting, blindly introduce dual pricing foreigners hotelrooms.

Pooliekev | 07 July 2022 - 18:25:57

Get the fights re-introduced and watch the numbers increase. Never mind what the elderly expats say. 

cyberspider | 05 July 2022 - 13:02:51

Do I still have to have negative test to Thailand? Facemasks? No thanks, i'll chose destinations where i can feel free. Check daily statistics on air traffic websites like flightradar, you'll find out that daily flights' number is at the same level or even higher than 2019. Here in Europe airports are collapsing under heavy traffic. Only destinations are different..

christysweet | 05 July 2022 - 10:11:13

Reuters is reporting Ministers are discouraging hotel discounts  and to focus on higher  end tourists..  like those that can afford gorgeous European destinations and to  whom cheap  prostitutes are not a especially a draw. 

maverick | 04 July 2022 - 15:34:17

The Middle East carriers can ramp up capacity quickly and easily - they will do so only when demand picks up - which will not before October - look out of your window to understand why. 

JSombra | 04 July 2022 - 14:19:40

Also travel costs up 20-40%? If coming from many European source markets you forgot a zero on each of those numbers, try 200 to 400% for July/Aug

JSombra | 04 July 2022 - 14:17:10

They forgot to add airlines are also reluctant  to restart flights to Thailand because they got burned by the constant "Thailand is reopening" plans over last 18 months that were just tiny reductions in restrictions.By time Thailand really reopened it is low season,when airlines will be least interested.
Also travel costs up 20-40%? If coming from many European source markets you forgot...

Ash Ward | 04 July 2022 - 13:24:13

JohnC, you are so correct. The Phuket govenor and his people just don't understand.

Nasa12 | 04 July 2022 - 10:37:24

You have 100% right JohnC. 

Kurt | 04 July 2022 - 10:35:17

Indeed, some airlines have long term fuel contracts, but those running out of it have to deal with higher fuel costs. Worldwide is a shortest of pilots and cabin crews. All over the world daily many flight cancellations. A nightmare in Europe. Thousand flight holidays. In USA this weekend 1000 cancellations per day. Rising ticket prices ( 20-40%). Airlines also must avoid Ukraine/russian airspace.

JohnC | 04 July 2022 - 09:16:36

It's not insufficient flights or fuel costs. It is insufficient numbers of tourists being interested in coming here. Why come here when there are so many more attractive price competitive options in great locattions. Thailand has to stop this silly idea that if they open their doors people will here. Clean up crime and corruption, stop dual pricing and clean up all the rubbish left everywhere!

Kurt | 04 July 2022 - 09:16:12

Of course it is now to late for preparing August stimulus packages for Europeans. That should have been done in January! According TCT, only 34% hotel occupancy rate. That percentage is of course concerning about the 50% of the hotels that are operational. And yes, forget paying salaries at pre pandemic levels. That time is over in hospitalty industry were is no job security.

 

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