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Phuket hotels start closing again

Phuket hotels start closing again

PHUKET: Hotels across Phuket that had re-opened in the hope of attracting enough guests to at least pay operating costs are now closing again, Kongsak Khoopongsakorn, President of the Thailand Hotels Association Southern chapter, has confirmed.

By The Phuket News

Friday 8 January 2021, 01:02PM

A normally bustling street in Patong now dark and quiet at night. Photo: Chutharat Plerin

A normally bustling street in Patong now dark and quiet at night. Photo: Chutharat Plerin

The lack of even domestic tourists due to the current COVID-19 outbreak has taken its toll, he said.

“As a result of the new outbreak of COVID-19, some hotel operators are considering temporarily closing their hotels again because a lot of bookings have been cancelled, and they cannot handle the costs,” Mr Kongsak said.

“From questioning about 10 hotel operators, three of them have confirmed that they are closing again because they cannot handle the cost and loss,” he said.

“There must be more hotel operators considering closing, but at this stage I cannot estimate how many,” he added.

“I believe this current outbreak will last at least one month because the number of infected people in the country is still increasing. Even though there are no new infected cases in Phuket, the tourists who would normally come to Phuket are usually from the high-risk provinces anyway,” Mr Kongsak explained.

Hotel operators in Phuket have offered exceptional discounts, but to no avail, he added.

“For example, some have offered promotions such as spending more than B2,000 on dinner will give you one-night stay free. Even though there have been some tourists, overall these [promotions] have not had much effect,” he said.

The current outbreak is now causing deep, long-term damage to Phuket’s tourism infrastructure, Mr Kongsak noted – a factor he warned of in April last year.

“The effect from the virus outbreak on Phuket’s tourism industry may last until 2024. Before this, we expected that tourism would become much better by the end of this year [2021], or the beginning of next year,” he said.

“Most Thai tourists who come to Phuket are from Bangkok, which now has areas that are classified as high-risk, and people living there are asked to stay home. Hotel operators themselves are also worried to welcome tourists from these areas,” Mr Kongsak explained.

“The crisis in Phuket will reach its peak this year, after operators kept trying to keep their businesses alive last year. Both small and big businesses are going to die in the same way this year,” Mr Kongsak said.

“This year, some hotel operators may announce to sell their hotels at prices that are 50-60% less than the value of the hotel,’ he warned.

“We need the government to save us. From AoT [airports of Thailand] reports, the number of tourists coming through Phuket International Airport is continuously falling, so Phuket tourism is still far from recovery,’ Mr Kongsak said.

“If the government does not have clear measures about soft loans, and moratoriums on debt and interest, many businesses operators will have no choice but to raise the white flag to this situation,” he added.

Bhummikitti Ruktaengam, President of Phuket Tourist Association, noted, “Although some tourists came to Phuket during the New Year holidays, the number of tourists was lower than expected.”

Mr Bhummikitti told The Phuket News that he did not have clear figures for the number of tourism arrivals over the New Year. “At this stage it would be better to confirm with the airport the number of arrivals [during the holidays],” he said.

Phuket International Airport General Manager Thanee Chuangchoo on Wednesday (Jan 6) confirmed that the number of flight bookings cancelled had seen six airlines reduce the number of flights to Phuket for the rest of January.

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AoT Phuket also confirmed that from Jan 1-5 a total of 38,915 passengers passed through Phuket airport, as follows: Jan 1 - 7,662 passengers; Jan 2 - 8,692 passengers; Jan 3 - 10,458 passengers; Jan 4 - 7,084 passengers; and Jan 5 - 5,015 passengers.

Domestic passengers passing through Phuket airport for the same days last year totalled 115,714, as follows: Jan 1 - 23,244 passengers; Jan 2 - 24,323 passengers; Jan 3 - 23,808 passengers; Jan 4 - 22,563 passengers; and Jan 5 - 21,776 passengers.

In total, the number of domestic passengers passing through Phuket airport this year was down 69.37% on last year, AoT reported.

“This time, even without a lockdown there are very few tourists because the Thai guests are people who live in the epidemic provinces, which are currently not traveling,” Mr Bhummikitti said.

“A very important factor at the moment is the control of both the source and the destination. The source already has a control process [for COVID-19], but what about the destination?,” he posed.

“The control [at the destination – Phuket] has not been that strict… We cannot let this continue,” he said.

“Although it has always been discussed that It wouldn’t be possible to have zero infections, we cannot have a cluster that spreads. When an infection is found, it must be quickly dealt with so that business and epidemic control can work together hand in hand,” Mr Bhummikitti said.

“But the weight is now more likely to go to epidemic control, which the business community itself gives importance to because we personally think that even if Phuket can control new infections, we will be okay, but if there is an outbreak, no one will come,” he added.

Mr Bhummikitti offered words of encouragement for hotel operators to hold on to survive.

“We have all been hit, including our brothers and sisters in outbreak areas who need a lot of encouragement, who as people who travel to Phuket cannot come. So at this time Phuket must keep itself as the safest area. When the situation improves, it will be easier to travel to Phuket," he said.

However, Mr Bhummikitti also said that Phuket hotel operators had been “wrung dry”, with many operators  not knowing what their next course of action should be.

“It has been exhausting,” he said. “Hopefully the government will understand, even though there are many tough questions to be answered.

“But one thing I want to keep in mind all the time is that the outbreak will eventually end. Then the focus will move back to economic matters. If entrepreneurs are able to survive this period, when the outbreak is over they can continue to operate. But if you let them fall, the impact will be much more negative – and will cause damage to the economy for a long time,” he said.

For now, the government must focus on tackling the current outbreak, but must also start providing genuine relief for operators struggling to survive, Mr Bhummikitti said.

“The government must prioritize control of the outbreak, because if the outbreak continues to spread, sparks [sic] will fall all over the place, and tourism definitely will not return. Go put out all the sparks first, and then come to see about tourism,” he said.

“But in the meantime, there must be support for entrepreneurs, which have three main issues: existing debt, the issue of labour, and paying for basic utilities,” Mr Bhummikitti noted.

“Because there are two sides to tourism: demand and supply. For the demand side, there is the ‘We Travel Together’ campaign which is very good, but at this time there is probably no one traveling due to the outbreak. But there must be something to support the supply side also,” he said.

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Vanillasky | 09 January 2021 - 08:08:29

Good write up. As a hotel operator I can only raise a small voice that maybe yyone way to make the hardest hit areas of Thailand (Phuket and Samui) recover quickest could be to prioritise vaccines for these 2 islands to create a safe zone and then effectively be able to create a travel bubble and let vaccinated tourists in as both the demand and supply is deemed safe. 

Sandbar | 09 January 2021 - 06:49:28

No tourist, no spending, no money, hotels closing. Time to take radical steps to reboot and generate money. Hotels should offer three free days accomidation on a five day booking to attract guest's back and start spending in shops, resturants, cafes and bars. 


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