Andrew Wood GM of Chaophya Park Hotel & Resorts in Thailand says it’s been a difficult few months with most hotels in Bangkok reporting down turns in business, with some reporting a 14% drop in revenues from the previous year.
He said that there are many factors at play, however price does not appear to be a major influencer.
Top of the list are security concerns particularly in the capital as a result of the The New Year bombings, the continued unrest in the South, the recent grenade attack close to the Rama Gardens hotel and a spate of travel advisories with government warnings all hurting tourism.
Forecasts for March 2007 in the capital are more of the same with occupancies normally hovering above 80%, however forecasters predict little more than 70%.
The big losers are the corporate and MICE market sectors, with some companies having issued bans on all but essential travel to Thailand with ongoing uncertainty over the interim government’s failure to curb ongoing security concerns.
A number of high profile events have recently cancelled with one 5 star hotel recently reporting loosing a North American corporate incentive group worth Bt 11m (US$ 309k), due to current travel advisories.
The financial corporate market is still reeling from the effects of a number of unclear government fiscal regulations and a series of political U-turns and add to this a weakening dollar and the short term looks decidedly unsettled.
The downturn appears not to be limited to the hotel sector with luxury car maker Daimler Chrysler reporting recent slower sales as potential customers take a wait and see approach and Krungthai Card (KTC), with its 1.4 million credit card holders, recently reporting a 43% drop in YOY profits.
TAT and THAI are shortly to announce major campaigns at boosting domestic spending with promotions aimed at families during the long school holidays and Songkran which leads to a mass exodus from the metropolis, during the April bank holiday.
With the low season just round the corner many hoteliers are expecting more challenges ahead as the industry looks for direction and revenue opportunities.
Report from Bangkok by Andrew Wood
