Thai hotels consider temporary shutdown amid low tourist demand

The president of the Thai Hotels Association says many properties are considering shutting down for the low season as a result of the Covid-19 resurgence. Marisa Sukosol Nunbhakdi says smaller hotels that don’t necessarily have the resources of the large chain properties are struggling with cash flow and crippled by low tourist demand. Many are considering shutting up shop between April and October or until demand resumes.

In a Bangkok Post report, the THA chief says April’s occupancy rates are expected to plummet to single digits, as happened in January during the second wave of the virus. She adds that the level of business in the last 2 weeks of the month will determine whether or not many will close. There are now just 400,000 working in the hotel industry, a huge drop compared to just a few years ago.

Marisa says just how bad everything gets, including the number of people laid off, will depend on how quickly the government can control the virus. She says vaccines are the key to reviving the decimated tourism sector, thereby boosting the economy and increasing tourist confidence.

“The government has to speed up vaccines for people employed in tourism, especially hotel staff, and those working in hospitals serving non-critical or asymptomatic patients, alternative state and state quarantines.”

Last month, the THA conducted a survey of 128 hotels which showed that most had still not experienced any financial recovery, particularly in the south of the country. At least 50% have not even achieved 10% of their pre-Covid revenue. Up to 40% of hotels have had to make staff redundant, while others continue to implement policies such as leave-without-pay (77%), mandatory holiday leave (76%), pay cuts (71%), changes to working schedules, (69%), reduced hours (56%), as well as invoking section 75 of the Labour Protection Act to pay 75% of a worker’s salary (20%).

A tiny minority (6%) of 5-star hotels in the southern provinces of Phang Nga and Surat Thani experienced improved occupancy and were able to hire additonal staff. However, the vast majority of properties saw their liquidity in March drop by 20% from February and many can only afford to continue operating for another 3 months. The THA boss is calling on the government to provide a monthly co-payment scheme or a debt holiday, as well as more stimulus packages to boost tourist demand.

SOURCE: Bangkok Post