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Phuket hotels slash prices, brace for rare slump

Phuket hotels slash prices, brace for rare slump

PHUKET: Hotels in Phuket have been forced to slash prices with rooms left vacant and beaches sparse as tourist chiefs struggle with a plunge in Chinese visitors caused by the US trade war and a stronger baht, reports AFP.

tourismChineseeconomics
By AFP

Tuesday 22 October 2019, 09:27AM


Phuket was the most visited destination in the country last year after Bangkok and a good gauge of the state of its crucial travel industry, the agency noted.

Tourism accounts for 18% of Thailand’s gross domestic product and Chinese holidaymakers make up more than a quarter of total arrivals.

But while 2.2 million people from the country visited in 2018, according to official figures, numbers for January-September were down almost a fifth on-year.

Claude de Crissey, Honorary Consul of France in Phuket and owner of about 40 rooms in the popular Patong Beach area, said Chinese tourists are usually present even during the current low season.

“That was not the case this year,” he said, adding he had to lower his prices by as much as 50%.

The problem is not just in Phuket, with hotels also struggling to fill rooms in the seaside resort of Pattaya on the mainland and Koh Samui island.

Trade tensions with the US have already made some Chinese reluctant to take holidays owing to uncertainty back home, while the Thai baht has risen around 10% against the yuan this year.

The Phoenix tour boat disaster off Phuket last year that killed 47 Chinese holidaymakers has also scared some off.

“We are worried,” an industry insider told AFP, declining to be named due to the sensitivity of the topic in a country where tourism provides tens of thousands of jobs.

Adding to the headache is the fact that more than 3,000 new hotel rooms are being constructed on the island, raising the question of who will fill them.

“In terms of business, it’s not good,” said Kongsak Khoopongsakorn, vice president of the association of hotels in Thailand and director of Vijitt Resort.

CIBS 2020 - The 25th China (Shanghai) International Boat Show

“Because… we have more hotels, more rooms to sell, we have more restaurants, more coffee shops.”

Still, Tourism Authority of Thailand (TAT) Governor Yuthasak Supasorn told AFP he remained “optimistic”, adding: “We should reach our goal of 39.8 million foreign visitors” this year.

However, that is only up from 38.2mn in 2018, much less than the jump seen from the previous year's total of 35.6mn.

Counting on India

Now hoteliers and tour package operators are targeting visitors from elsewhere, particularly India, which experts see as a huge untapped market.

“We are counting on the Indians to revive the sector,” Mr Kongsak said.

A rapid expansion of the middle class in India, increased direct flights and visa-free travel have prompted Thailand to revise forecasts upwards.

It now expects two million Indian tourists this year, after an increase of nearly 25% on-year in the first seven months.

But for now, the lower arrivals is evident on the streets of Phuket.

“I’ve never seen anything as bad as what it is at the moment,” said Paul Scott from Australia, who said he has been coming to Thailand for 15 years.

He mainly blamed the stronger baht for the drop-off but also the fact that Thailand wasn’t the untouched vacation paradise it once was. “Now it’s not so new… and it’s not cheap," he said.

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Mr Richie | 24 October 2019 - 14:17:02

hotels cutting prices? not what I'm seeing on my computer screen, still dear and the exchange rate 20 bht to the aussie dollar, it's Thailand or Vietnam this year,getting worse every year for the last 12 yrs we've been coming . 

Christy Sweet | 23 October 2019 - 13:12:58

Infamously rapey types are about. Have had on  two recent occasions men enter my stable, 150 meters from the resort they were at  and ask for,  "er...some water" which has  never happened before. Fortunately they responded to a terse and aggressive GTFO right now. Women, do not give an inch in way of politeness, trust your gut when they approach and be VERY  aggressive in responses. 

Kurt | 23 October 2019 - 11:56:54

Phuket became very expensive for tourists. The thai tourist branch still in the 'The sky is the limit' setting. Completely ignoring tourist feelings. Give tourists on departure in airport a comment form to express about Phuket. ( Don't forget questions about airport Immigration,, taxis, mini vans).

Kurt | 23 October 2019 - 11:44:22

Tourists now vote with their feet. Totally wrong thinking to count on the Indians. ( don't put your eggs in 1 basket) The whole thai tourist industry has to upgrade herself to international 2019 thinking.
On Phuket is since 2014 the regimental treatment of tourists a nail in the coffin. It becomes visible now.

Kurt | 23 October 2019 - 11:36:50

The plunge of chinese tourists is not due to the US trade war. The enormous grow of chinese tourists to Vietnam this moment not justify that analyse. It's the strong thai baht and the more and more lacking in tourist service of the thai tourist industry. Thai are spoiled. The thinking was/is: " whatever we do not, nevermind, the tourists still come anyway". Tourists now vote with the...

JSombra | 22 October 2019 - 23:49:48

Indian is not saving Thai tourism because its damned if they do come,damned if they don't.Indians come,outside of wedding parties the spend is minimal.And sadly,due to simple racism,more indians come more people from other countrys stop coming.
Its time for TAT to stop putting all their eggs in single baskets,first EU,then Aus,then RU,then CN now India.How about balanced marketing plan instea...

Kurt | 22 October 2019 - 22:13:32

Counting on Indians to revive the Phuket hotels? Revive? But still building 10,000 new phuket rooms? Without water guarantee?Are they nuts? In Naiharn are 4-5 star hotels filling their rooms with 2-3 day indians/chinese  groups for room prices that are usually guesthouse prices. Revive? This is survival!

Foot | 22 October 2019 - 18:14:18

Thailand has killed the  "Golden Goose" of tourism by taking it for granted.
Many saw it coming and tried to correct it.  Many saw it and didn't care.
R.I.P.

goldwing | 22 October 2019 - 12:25:00

greed has ruined this island

CaptainJack69 | 22 October 2019 - 12:22:15

Don't think the Indian market will save use. They might come, but they don't spend anything when they're here. They're even cheaper than the Chinese. They just walk around looking at things and eating out of 7-11. When they actually do buy something they want to haggle and pay half price for everything. Their average daily spend is probably less than 500 baht each.

Foot | 22 October 2019 - 11:45:19

This has been here for years.  And, it's going to get much worse.

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