Sharp fall in hotel occupancy

The global economic meltdown and financial crisis are cited as the main reasons for the decline.

Five-star hotels in Bangkok are running at an occupancy rate of 60 per cent this month, down from 75 per cent a year ago, said association vice president Surapong Techaruvichit.

Hotel occupancy in Phuket is only 57 per cent, against 75 per cent last November, while Hua Hin and Cha-am are as low as 30-35 per cent from 50 per cent during the last high season.

Surapong said hotels across the country had suffered from the economic slowdown in October.

Hotels in Bangkok ran at 57-per-cent occupancy, down from 68 per cent, while Chiang Mai hoteliers ran at only 48 per cent against 61 per cent a year ago.

Hotels in Pattaya ran at 47-per-cent occupancy, down from 52 per cent in October last year.

"All major tourist destinations are affected by the economic crisis. However, some provinces like Kanchanaburi and Phitsanulok are gaining more tourists in this high season," said Surapong.

He added that the hotel sector did not see brighter prospects for 2009, because long-haul tourists from Europe are expected to be fewer in number than this year due to increasing job losses and concern over future earnings.

"In the UK alone, an additional 3 million people are expected to lose their jobs. More than 1 million have already been laid off," said Surapong.

Surapong said hoteliers were now worried about their future prospects, with most staff bringing in less money due to fewer tourist arrivals.

He said that if the average occupancy rate fell below 60 per cent in two consecutive years, many workers could be expected to be laid off.

Chanin Donavanik, chief executive officer of Dusit International, said the hotel business in 2009 would be worse than this year.

Tourist arrivals from major markets - including the United Kingdom, Germany, Australia, Japan, India and the Middle East - will slow down. Only China has positive prospects, he said.

"The number of European arrivals is expected to drop sharply, as many countries are now affected by the economic downturn," said Chanin.

He suggested the Tourism Authority of Thailand should prepare more marketing strategies to claw back visitors.

Moreover, Thai Airways International should reduce air fares, and Airports of Thailand is urged to cut its airport fees in order to persuade international carriers to keep their operations in the country, he added.

"In the short term, we [hotels] need to fill our rooms by offering lower prices," Chanin said.