Airlines, hotels say 2021 likely to be even worse than last year

Thai airlines and hotels fear that the tourism crisis in 2021 is set to dwarf last year’s in terms of its impact, as they appeal for government aid. The Bangkok Post reports that Asia Aviation, the largest shareholder in Thai AirAsia, has warned that when international tourism eventually does resume, there may not be enough suppliers to meet demand as most operators have had to shut down.

Executive chairman Tassapon Bijleveld says despite the government’s domestic tourism stimulus campaign, over 1.3 million airline seats, out of a quota of 2 million, remain available. Even though the subsidy has been increased from 2,000 to 3,000 baht, Tassapon says the low take-up is indicative of people’s reluctance to fly, opting to travel to destinations within driving distance instead. He says this is particularly true following the resurgence of Covid-19 late last year.

Earlier this week, the National Economic and Social Development Council stated that international tourism numbers are likely to drop to 3.2 million just year, half that of last year’s 6.7 million arrivals.

Airlines have already had to vastly decrease the number of flights on offer, with the Civil Aviation Authority of Thailand reporting more than a 27% year-on-year decrease in domestic passengers in the last quarter of 2020. The decrease in international flights for the same period was over 99%. Tassapon says Thai AirAsia now operates just 20 flights a day, using just 10 of its 62 aircraft. Prior to the resurgence of the virus, TAA was using 40 aircraft. It has also had to suspend 75% of employees this month, with most having to take unpaid leave.

“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.”

Meanwhile, businesses are still unclear on the proposal for soft loans, with the government currently focused on this week’s no-confidence debate.

“We really 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.”

Meanwhile, Marisa Sukosol Nunbhakdi from the Thai Hotels Association says operators currently have no way of knowing when they might see a return to business as usual.

“When we seek loans, banks always request our business plan or the period we can earn profit, but under these circumstances, hotels don’t really have a clue when will business get back to normal.”

She says half of Thailand’s hotels have now shut down, while the other half continue to limp along. While some hotel workers have managed to keep their jobs, they are missing out on tips, which contributed significantly to their overall pay. Some properties are having to accommodate their workers on site as they are no longer able to pay their rent.

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

SOURCE: Bangkok Post