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The future of Thailand’s hotels, tough times ahead – VIDEO

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Thailand’s hotels are facing a very dark time with the Thai borders still largely closed and many of them remaining closed for business. Whilst some local domestic stimulus has provided a bit of a minor reboot for the battered industry, there is still more than 90% of the rooms in the country remaining unoccupied with staff unemployed, debts and leases unpaid.

C9hotelworks.com MD, Bill Barnett, is of the region’s most respected consultants for the industry and has been in constant contact with them during the Covid-19 pandemic.

Phuket’s hotel industry is reaching breaking point and drastic economic support from the government will be needed for it to survive the high season. The warning from a slew of industry leaders who fear the island has reached a crucial turning point.

In the wake of the controversial “Phuket Model” international travel reopening scheme, reality is biting back as hotels in Thailand’s leading resort island are unable to sustain operating viability based on domestic tourism. 

According to the Airports of Thailand, passenger arrivals at the aviation gateway have plunged 65% year-on-year from January through July of this year. 

What is clear is that the 86,000 rooms in Phuket’s registered accommodation establishments cannot realistically break-even or even be cash-flow positive with only domestic demand. This realistically could set the scene for 50,000 job losses in the hotel sector this year if there’s no support forth coming or international visitors are not allowed in.

One of the green shoots is the Alternative Local State Quarantine program, with over 60 island properties applying. While this program is meant to emulate the ASQ program in Bangkok, given there are no direct international flights to Phuket, the government needs wider support of a return of international travellers at a local level and implement inter-ministerial coordination before it could materialise. But this may take months. 

Anthony Lark, President of the Phuket Hotels Association that represents 78 hotels in Phuket said: “The math simply doesn’t work with single-digit occupancies being reported. No amount of induced local demand can prevent the dramatic continued loss of jobs and rapidly eroding financial crisis for owners and operators. We strongly advocate a safe, pragmatic, and strategic reopening for foreign travellers.”

 

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9 Comments

9 Comments

  1. murika

    Friday, September 25, 2020 at 12:45 pm

    why are you lying, payut has already organised all for arrival of super rich tourist in 2021, he say they will come and spend 800 k bath per month, that will compensate largely for the 40 millions tourist lost, how dare you defy the vision of our supreme leader, he know all, and life unfold over his willpower.

    • Stefan Svensson

      Friday, September 25, 2020 at 3:02 pm

      Oh yes! Sorry but you have to wake up now! Who told you this lie ?
      Better keep it closed so they have a reason to wish the tourist will come back.

    • Sami

      Saturday, September 26, 2020 at 12:39 am

      You must be the dumbest person not only in Thailand but in the entire universe…Dont make a fool of yourself and learn to keep your mouth shut and accept facts…no matter how bitter the truth is about your government!

      • murika

        Saturday, September 26, 2020 at 11:23 am

        i thought my comment was quite obviously ironic, maybe you are dumber than me to not understand it !

  2. Mark Davies

    Friday, September 25, 2020 at 1:04 pm

    …..”given there are no direct international flights to Phuket”

    What about Singapore, Hong Kong, KL, India, Russia, Middle East, China, Korea

  3. Toby Andrews

    Friday, September 25, 2020 at 1:14 pm

    Are these the same hotels that grabbed the foreigners’ deposits when they could not travel to Thailand?
    Are these the hotels that profited when foreigners could not leave Phuket?

  4. Jason

    Friday, September 25, 2020 at 4:49 pm

    What is happening in Phuket is the logical conclusion of the covid 19 lockdown of Thailand. The method of suppression and then eradication of the virus to a point where only foreign arrivals have it has seen Thailand with one of the lowest numbers of active cases in the world. The culture of obedience has made this possible. The people do what they are told to do. But at what cost?

    We are now seeing the cost. Closed businesses, people unemployed, some starving. What we haven’t seen to date is a balance. A balance between peoples livelihoods and control of the virus. So far, the virus has control of everything and livelihoods are being sacrificed to maintain a zero community transmission situation. (I do have my doubts about the “Zero”. Without widespread testing of people who may have symptoms, how do you really know?).

    The choice to achieve a balance rests, like it or not, with the government. But if the government does nothing and people continue to close businesses, lose jobs and starve, things might reach a critical point. I do hope that the government will quickly move to devise a plan where foreign tourists can enter at a rate that willboth keep the country safe and at the same time allow it people to return to their livelihoods.

  5. EdwardV

    Saturday, September 26, 2020 at 2:38 am

    The only way to help most of these hotels is to reopen the country in a safe but quick and large way. Granted not an easy thing to do, but there is no other way. Just giving them low cost loans will just postpone the inevitable bankruptcy. They are in the business of renting rooms to tourists and since the domestic scheme failed miserably there is only one other alternative. So the only question then is can Thailand open up fast enough, safe enough and in a large enough number to save them before it’s too late.

  6. Nipral

    Saturday, September 26, 2020 at 3:03 pm

    Thanks to the moronic government’s plans (compulsory expensive inappropriate quarantine,
    fake insurance, charter flights, and probably more to come)the 2020/2021 high season is lost. We have all made our bookings without considering Thailand. The next one will probably be alike and so on…..
    Incompetence and corruption drive nowhere but to civil war.
    Nevertheless people in Thailand are starving and suffer.
    The PM and his shameless followers have food on their plate, roof over the head and increasing substantial bank accounts. As Trumpy would say “it is what it is” !!!!

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