Hotels hit back at “gouging” allegations

PHUKET: Room rates in major Phuket hotels, in US dollar terms, have fallen sharply between 1996 and 1998, claims the Southern Chapter of the Thai Hotels Association (THA), citing a survey it recently carried out. The THA conducted the survey to counter allegations that hotels had increased room rates by 30% to 50% to take advantage of high demand as record numbers of foreign visitors flooded into the island. Mark Van Ogtrop, general manager of the Dusit Laguna Resort Hotel in Cherng Talay, and the director of the marketing committee for the THA’s Southern Chapter, said the survey should put paid to claims that hotels were exploiting the demand for rooms by hiking prices. “Most hoteliers are responsible people and are not in the business for short-term gain. If they were exploiting the demand for rooms by increasing prices, that would send out bad signals and hurt their business in the future. It would also damage the reputation of Phuket.” The survey showed that between 1996 and 1998 there was a decrease of 25% in average room rates at seven leading hotels, in US dollar terms. The decrease between 1997 and 1998 was 11%. Most hotel room rates in Phuket will stabilize during 1999 and 2000, said the THA, though some hotels will continue to drop rates to encourage more guests. Hotels surveyed included the Dusit Laguna, Holiday Inn, Laguna Beach Resort, Le Meridien, Sheraton Grande Laguna Phuket, The Allamanda and The Chedi Phuket. “We are concerned that many people will believe that room prices in Phuket have become too expensive, so they will switch holiday destinations,” said Methee Tanmanatragul, general manager for the Kata Thani group and a member of the Southern Chapter committee. “We want to let potential visitors to Phuket know that this is not the case.” Khun Methee said the misunderstanding surrounding hotel price increases stemmed from the devaluation of the baht, which was floated against the US dollar in 1997. But he pointed out that as many as 90% of foreign visitors to Phuket book and pay for their hotel rooms in their home country, and in their own currency, before travelling to Phuket, so the currency fluctuations of the baht against the US dollar were not an issue. “They are still paying the same price in their own currency as they did two years ago before the baht was floated. In many cases, they are paying a lot less.” Mr Van Ogtrop said that during Phuket’s off-peak season, from April to October, room rates drop substantially. “During these months hotels lower their rates by up to 50%, making Phuket one of the best value-for-money holiday resorts in Asia. This is a factor that is often ignored.”