Thailand's Tourism veering from bad to worse

17 Feb 2021

The tourism situation this year has been dubbed by airlines and hotels as a worse crisis than the first outbreak of the pandemic, leaving them clinging to the hope of a government remedy. 

As foreign tourists return in the future, Tassapon Bijleveld, executive chairman of Asia Aviation, Thai AirAsia's largest shareholder (TAA), said Thailand might not have sufficient supply to serve them as most operators have already shut down of financial problems.

The air ticket quota of 2 million seats still has over 1.3 million seats available, unlike the hotel business that saw 6 million room nights in the stimulus campaign fully redeemed, even though the government increased the subsidy from 2,000 baht to 3,000 baht in December. 

Mr Tassapon said those figures showed that local tourists skipped flying and shifted within driving distance to destinations, particularly after the fresh Covid-19 wave started in December.

All airlines will see a much more opaque future, combined with lower purchasing power and travel restrictions in some areas, as the industry is already witnessing fewer flights a day at the moment, he said. 

The Civil Aviation Authority of Thailand reported that in the fourth quarter, the number of domestic passengers dropped by 27.1 per cent year-on-year, while international flights dropped by 99.1 per cent the period.

On average, TAA now only operates 20 flights a day with only 10 aircraft, down from 40 jets before the actual second outbreak, while the fleet has a total of 62. 

"Not only are airlines facing an impact, but half of the restaurants and shops in Don Mueang airport have had to close temporarily which could indicate the lower level of consumption," Mr Tassapon said.

He said that under the supervision of the Export-Import Bank of Thailand (Exim Bank), all airlines may have to wait further for soft loans, as the government is likely to push this proposal aside until this week's no-confidence debate passes. 

"We have no idea about the details of the proposal from Exim Bank and don't know when the cabinet will mull this issue.

It's like we're walking with blind eyes during the crisis now," Mr Tassapon said. 

This month, TAA suspended 75% of its workforce, offering a leave-without-pay option to most of them, as it still hopes the situation will improve in the future. But he admitted that right now it's hard to give any forecast.

As the National Economic and Social Development Council predicted on Monday that the number of foreign visitors will plunge by half to 3.2 million compared to 6.7 million last year, down from an earlier estimate of 5 million, the tourism outlook for this year faces dimmer prospects again. 

Marisa Sukosol Nunbhakdi, president of the Thai Hotels Association, said the crisis this time is more difficult to deal with as it's hard to predict when a business can get back to normal. 

"When we seek loans, banks always request for our business plan or we can earn profit for the period, but under these circumstances, hotels do not have a clue when the business will go back to normal." according to Mrs Marisa.

She said 50 per cent of hotels nationwide have been closed, while other hotel operators and their workforce are struggling to survive. 

Though some hotels maintain employee positions, their living standards were worse as no service charge is considered a mainstream source of revenue for the hospitality business. 

When some of them were unable to pay their rent, some hotels had to offer their properties as shelters for workers. 

We need government support, or else we could see the collapse of the whole tourism sector before things get back to better shape, "We need support from the government, or else we could see the whole tourism industry collapse before things get back to a better”.