Can the Thai hospitality sector survive 2022?

[webfact]

File photo

 

by Michael Bridge

Thailand is now the most searched-for destination in the world on travel according to giant Agoda’s search engine.

Thailand apparently topped other popular travel destinations and is seen as a possible return to normalcy following two years of Covid-19 shutdown.

According to the Agoda, Thailand saw nearly a 500 percent increase in the number of searches since the beginning of the year with many looking to travel to the country between March and September.

 

The news will be a welcome one for Thailand’s ailing travel industry which has been virtually closed for the past couple of years due to the global pandemic.

The top countries to search for possible accommodation options across Thailand were Japan, the United States, Singapore, and the United Kingdom. 

Meanwhile, a couple of weeks ago Agoda’s main rival Booking.com was quoted as saying that travel in Asia-Pacific is trailing the rest of the world and should expect a bumpy recovery, as countries in the region have been slower to open borders than other destinations.

 

I am sure we need to take all this information with a massive pinch of salt, as travel companies and tourist boards are all running around hyping their countries and businesses, trying to gain an advantage over their competitors.

One issue many is would-be international travellers are facing is uncertainty. 

 

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The Thai tourist industry has been telling the government to scrap the controversial pre-registration program known as Thailand Pass.

All the government has said is it would consider such a request, but that does not help worried tourists when they ask their travel agents what the rules actually are.

Someone in the government should realise that the cost of trying to save the spread of the milder Omicron virus, has to be outweighed by the huge cost to the hospitality industry and the country in general.

One thing is for sure the large number of Russians that filled the Thai resorts in the past will not be returning for some time.

 

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[Soikhaonoiken]

Yes , the hospitality industry can survive in 2022, but only if they end all restrictions immediately,  if not it will be curtains for many businesses in 2022

[internationalism]

Agoda and booking are not competitors at all, as both are under same ownership. Just agoda is concentrating on asian market. 
 

some in hospitality might not survive this year. They run out of savings, are behind rent and bills. 
Many fall into disrepair. Mould take fast over fabrics in unused, unventilated hotel rooms. Mattresses are the first to rot, as they cant be washed and properly dried. 

One of my favourite thai massage shops on phrakanong is closing down in may. They are 6 months behind rent. No thai investors, as they are also short of cash and tourism is uncertain in that part of sukhumwit. 

Thai tourist customers are hard to deal with at the lower end of market. Those "middle classes" are money pinchers. Won't splash over the essentials. 
 

For many game breaker would be songkran. Lets see how well hotels will be booked. That will show mood for the next few months. That before foreigners do finally arrive in quantities. 

Tourist season for international arrivals is from the middle of october. Too late to have an impact on this year income. Some will came during summer holidays july-august, but it never was a large wave, because of a rainy season. 

[RandiRona]

Well....I heard this like 100 times that Agoda searches are favoring Thailand, havent seen those searches turned it into booking. Keep dreaming!!! 

[ChC1]

Both are accurate.

 

Every time when TAT and Thailand have information that they anticipate changes in entry requirement, there would be a surge in searching hotels on Agoda.

 

Also, Agoda buys ads on internet, so anyone who accidentally searched anything remoted connect to Thailand would/might/maybe be offered a deep link to Agoda to encourage internet users to search for hotels on Agoda.

 

To Agoda, the interests are increasing. But the actual bookings?

 

Well, this is where bookings dot com site is telling the truth. It is going nowhere. There is simply not enough tourists actually book anything.

 

Agoda needs news like this to remain relevant. A vague terms that searching has increased. But when? and by how much? Any bookings? Conversion rate from search click to actual booking? No words on it. Because Agoda's intention is to get on the news and be relevant to make sure investors are happy that it is spending money on advertisement to stay relevant. It is called, errrr, marketing. For all we know, the increase in search traffic might be solely based on increasing marketing budget Agoda spends on search engines. 

 

So let us go back to the original question. I am afraid Thailand unfortunately have missed the opportunity. 

 

First, Thailand now has a bad taste left among tourists who would have returned. The entry requirement has too many obstacles. People have been waiting and waiting. It has been a year since many of Europeans and Americans got their vaccine and was waiting for Thailand to open up. But what Thailand had done is to tell them that Thailand does not want them. So many of them will discover some destinations they did not think of going: Spain, Portugal, Turkey, Egypt, UAE, Qatar, Maldives, the Caribbean, the cruise ships...Staycation becomes another fashionable thing among tourists.

 

Second, now Thailand is unfortunately becoming a Covid hot spot. Remember how Thailand introduced the draconian entry requirement because Europe and American was a dirty place rampant with Covid? Now you try to convince the triple jabbed tourists from those country Thailand looked down at earlier when Thailand was the 'example' of clean Covid free place to pay a visit? Well, some might. But many will say no. The daily infection number will make some of the tourists staying away.

 

Third, Thailand is not helping itself by position itself begging for Indians, Chinese and Russian tourists. Believe in it or not, many tourists do take moral seriously. Especially Europeans, with the Russian invasion, many Europeans would think twice about Thailand that publicly luring tourists from India (who buys oil from Russia which indirectly fund the war), China (the biggest Russia backer) and Russia itself. At this moment, there is no boycott of Thailand yet. But it could be a thing as war going longer and Russia's friends were further exposed.

 

Fourth, economical condition in the world means less disposable income to spend in Thailand. High inflation, high energy price, rising interests rates...The longer Thailand wait, the more bleak the future for Thailand tourism is to be. The middle class is being squeezed really hard with high inflation and high oil price. And the worst is not here yet. If any forecast is to be taken, the traditional middle class that typically spend big in Thailand will suffer greatly by end of the year and next year. When interest rate in Europe and USA hit 2.5%, Thailand will find itself have at least 50% less tourist trips from USA and Europe.

 

Fifth, did I mention airfares will become more expensive and Thailand hotels and restaurant will have to raise price to double of what it was soon? You guys are good at calculation.

 

Thailand has to be totally open by May, if it missed the May deadline, one third of the business may fall. Not only that, if world economic condition continue worsen with 7% inflation quarter on quarter, and oil price stay above $120 for long time to come, the high season in October is not going to happen. The great squeeze of Middle Class in USA and Europe will kill off any remaining demand. People will take vacations closer to home.

 

Finally, the political risks are increasing every day Thailand remain draconian on tourists entry hence deprive many livelihoods and job opportunities. Why do you suddenly see news about Thaksin? Think about it, the military government has been in power for quite a long time, the longer it is controlling, and the longer Covid is damaging the society, the more tension there is brewing within society. Yellow shirts, red shirts have never gone away. It is still coexisting in the society. When hardship hits, it will crumble. Old feud will be discussed. People with different political views will re-group. The longer the current situation going on, the more/higher pressure it will accumulate over a short period of time. Soon or later, some political miscalculation will cause a major break points. It might take few years, it might never happen in our life time. But Thailand's history is full of coup and political infighting that involve with the mass. And history tends to repeat itself. The current political cycle will find its ending pretty much sooner should one corner of the society is hard hit by the hardships.

 

Can Thai hospitality sector survive 2022? Unfortunately Thailand has missed its chance, it will no longer be depended on the next policy chance of Thailand's Covid entry rules. Rather, in my opinion, if current situation is not improving soon worldwide, 2022 is a gone year for many working in Thailand tourism sector. For potential tourists, not only their smaller disposable income will stop them making big trips to Thailand with higher air fares and more expensive lodging and food expenditures, the increasingly unstable political outlook in Thailand will stop many coming visit even if the remaining restrictions are cancelled.

[Jerno]

Does Agoda explain the many hoops Tourists have to jump through to get into Thailand?  Most searched,   least followed through once the hoops are discovered.

[BayArea]

If you considered head above water surviving then yes! ????

[hotchilli]

5 hours ago, webfact said:

Thailand is now the most searched-for destination in the world on travel according to giant Agoda’s search engine.

Searched for.... but not arrived in the same numbers.

[Karma80]

Too many global impacts. Asian omicron first peak not rached yet, inflation smashing into discretionary spending and consumer confidence, war and wide sweeping impacts of sanctions, China with no exit ramp for covid keeping the largest travel base for Thailand locked at home, just to name a few. Great time to go on holiday...

 

Dropping all restrictions tomorrow of course will help, but the fundamentals may have changed for for the medium term. Meanwhile, the TAT just bangs the drum of "quality tourism", but actually does completely nothing in any practical terms to drive into new segments like remote workers and longer term travellers. 

[RichardColeman]

6 hours ago, webfact said:

Thailand is now the most searched-for destination in the world on travel according to giant Agoda’s search engine.

It's also probably the tourism country with the most closing of 7/11's due to lack of same tourism too

[mania]

Quote

Can the Thai hospitality sector survive 2022?

Sectors of course will survive even if they hibernate & wake later but

 all the workers? How will they feed themselves or their families, pay their bills?

 

If this does not end soon expect a large uptick in crime as when all options are exhausted &

there is no government welfare support only crime as an option remains

 

Also beware becoming a target as those who appear to have $$$ are the low hanging fruits

 

This country although opinion is well hidden is close to civil unrest/war IMO it is like a tinder box

awaiting a match

[Caldera]

I wondered the same in 2020 and 2021. And here we are, wondering if it can survive another year of over-the-top restrictions.

[Iamfalang]

Brah, it died in 2020

 

Zombie hospitality?        Yes

[kingstonkid]

The Thai industry can survive but it has to change it's plan.  As I keep saying instead of trying to attract outside tourism they need to attract the Domestic's market.

 

Places like Pattaya need to look at how they can attract the families and the university youth markets.  Forget about the bad old days they at least for awhile are gone.

 

[BritManToo]

7 hours ago, internationalism said:

Thai tourist customers are hard to deal with at the lower end of market. Those "middle classes" are money pinchers. Won't splash over the essentials. 

That's right!

 

[Thailand]

Unless the doors are fully opened with NO restrictions then many more tourism related businesses will be closing their doors!

[BritManToo]

7 hours ago, RandiRona said:

Well....I heard this like 100 times that Agoda searches are favoring Thailand, havent seen those searches turned it into booking. Keep dreaming!!! 

As for Agoda and Booking.com ..... I've uninstalled the apps from my phone as it doesn't appear I will be able to leave Thailand then re-enter in the near future without buying needless expensive insurance I don't want.

[RandiRona]

5 minutes ago, BritManToo said:

As for Agoda and Booking.com ..... I've uninstalled the apps from my phone as it doesn't appear I will be able to leave Thailand then re-enter in the near future without buying needless expensive insurance I don't want.

I dont think they can get 'real tourists' real soon with Russians/Chinese stopped from flying out. They arent making things easier for reat of the world. With Inflation growing and income stagnating, I do see social unrest in LOS....

[BritManToo]

2 minutes ago, RandiRona said:

I dont think they can get 'real tourists' real soon with Russians/Chinese stopped from flying out. They arent making things easier for reat of the world. With Inflation growing and income stagnating, I do see social unrest in LOS....

I see social unrest everywhere ..............

[RandiRona]

5 hours ago, ChC1 said:

Both are accurate.

 

Every time when TAT and Thailand have information that they anticipate changes in entry requirement, there would be a surge in searching hotels on Agoda.

 

Also, Agoda buys ads on internet, so anyone who accidentally searched anything remoted connect to Thailand would/might/maybe be offered a deep link to Agoda to encourage internet users to search for hotels on Agoda.

 

To Agoda, the interests are increasing. But the actual bookings?

 

Well, this is where bookings dot com site is telling the truth. It is going nowhere. There is simply not enough tourists actually book anything.

 

Agoda needs news like this to remain relevant. A vague terms that searching has increased. But when? and by how much? Any bookings? Conversion rate from search click to actual booking? No words on it. Because Agoda's intention is to get on the news and be relevant to make sure investors are happy that it is spending money on advertisement to stay relevant. It is called, errrr, marketing. For all we know, the increase in search traffic might be solely based on increasing marketing budget Agoda spends on search engines. 

 

So let us go back to the original question. I am afraid Thailand unfortunately have missed the opportunity. 

 

First, Thailand now has a bad taste left among tourists who would have returned. The entry requirement has too many obstacles. People have been waiting and waiting. It has been a year since many of Europeans and Americans got their vaccine and was waiting for Thailand to open up. But what Thailand had done is to tell them that Thailand does not want them. So many of them will discover some destinations they did not think of going: Spain, Portugal, Turkey, Egypt, UAE, Qatar, Maldives, the Caribbean, the cruise ships...Staycation becomes another fashionable thing among tourists.

 

Second, now Thailand is unfortunately becoming a Covid hot spot. Remember how Thailand introduced the draconian entry requirement because Europe and American was a dirty place rampant with Covid? Now you try to convince the triple jabbed tourists from those country Thailand looked down at earlier when Thailand was the 'example' of clean Covid free place to pay a visit? Well, some might. But many will say no. The daily infection number will make some of the tourists staying away.

 

Third, Thailand is not helping itself by position itself begging for Indians, Chinese and Russian tourists. Believe in it or not, many tourists do take moral seriously. Especially Europeans, with the Russian invasion, many Europeans would think twice about Thailand that publicly luring tourists from India (who buys oil from Russia which indirectly fund the war), China (the biggest Russia backer) and Russia itself. At this moment, there is no boycott of Thailand yet. But it could be a thing as war going longer and Russia's friends were further exposed.

 

Fourth, economical condition in the world means less disposable income to spend in Thailand. High inflation, high energy price, rising interests rates...The longer Thailand wait, the more bleak the future for Thailand tourism is to be. The middle class is being squeezed really hard with high inflation and high oil price. And the worst is not here yet. If any forecast is to be taken, the traditional middle class that typically spend big in Thailand will suffer greatly by end of the year and next year. When interest rate in Europe and USA hit 2.5%, Thailand will find itself have at least 50% less tourist trips from USA and Europe.

 

Fifth, did I mention airfares will become more expensive and Thailand hotels and restaurant will have to raise price to double of what it was soon? You guys are good at calculation.

 

Thailand has to be totally open by May, if it missed the May deadline, one third of the business may fall. Not only that, if world economic condition continue worsen with 7% inflation quarter on quarter, and oil price stay above $120 for long time to come, the high season in October is not going to happen. The great squeeze of Middle Class in USA and Europe will kill off any remaining demand. People will take vacations closer to home.

 

Finally, the political risks are increasing every day Thailand remain draconian on tourists entry hence deprive many livelihoods and job opportunities. Why do you suddenly see news about Thaksin? Think about it, the military government has been in power for quite a long time, the longer it is controlling, and the longer Covid is damaging the society, the more tension there is brewing within society. Yellow shirts, red shirts have never gone away. It is still coexisting in the society. When hardship hits, it will crumble. Old feud will be discussed. People with different political views will re-group. The longer the current situation going on, the more/higher pressure it will accumulate over a short period of time. Soon or later, some political miscalculation will cause a major break points. It might take few years, it might never happen in our life time. But Thailand's history is full of coup and political infighting that involve with the mass. And history tends to repeat itself. The current political cycle will find its ending pretty much sooner should one corner of the society is hard hit by the hardships.

 

Can Thai hospitality sector survive 2022? Unfortunately Thailand has missed its chance, it will no longer be depended on the next policy chance of Thailand's Covid entry rules. Rather, in my opinion, if current situation is not improving soon worldwide, 2022 is a gone year for many working in Thailand tourism sector. For potential tourists, not only their smaller disposable income will stop them making big trips to Thailand with higher air fares and more expensive lodging and food expenditures, the increasingly unstable political outlook in Thailand will stop many coming visit even if the remaining restrictions are cancelled.

Very well written. This is how these news sites should write articles. KUDOS!!

[Enzian]

Couple days ago had a discussion with the farang monk who originally introduced me to Thailand. We agreed that the one positive in the situation is that, no matter how low on the social ladder, it's almost impossible to starve to death in Thailand. But just having to say that kind of tells you where we're at.

[RandiRona]

1 minute ago, BritManToo said:

I see social unrest everywhere ..............

I agree but Thais are little more agreeable to their surroundings if their stomachs are full but if not, then you may expect them to publically protest which end up turning violent , circa 2010. I am sure Junta wont like red shirts again starts barricading Bangkok like they did in 2010. So they need to open economy and tourism. 

[SomchaiCNX]

Yes they can survive if and only if the people from TAT and other government related agencies start to shut up. Agoda and many others are just in the hands of a few people, they don't give a F,,, about THailand and its people only profit is what they are looking for. 

[greeneking]

3 hours ago, hotchilli said:

Searched for.... but not arrived in the same numbers.

In the UK people are facing 'eat or heat' cash problems.

Not 'eat or heat or a nice holiday in Thailand.'

[StayinThailand2much]

8 hours ago, RandiRona said:

Well....I heard this like 100 times that Agoda searches are favoring Thailand, havent seen those searches turned it into booking. Keep dreaming!!! 

Not surprised. As often as I search for destinations outside Thailand,

every time I start searching, I am offered destinations in Thailand by Agoda on the search screen.

 

It's a bit like Google, I guess. You can search for results in English and 'out of region' for ages, but you still have to re-adjust language and location settings every day to not just get Thai and locally-sourced search results.

[carlf]

I'm surprised that I don't read more about trying to entice more Japanese to come on holiday here.  It's a huge generalisation, but they are usually great customers: well behaved, don't make trouble, spend quite a bit, and not so far away.  And they just recently opened up Japan for quarantine-free entry FOR THE JAPANESE who are abroad (not yet for the non-Japanese tourists to enter Japan).  So I'm guessing that a lot of Japanese are looking to go on holiday now, and Thailand still has a pretty good reputation amongst Japanese tourists, I think.

 

[patongphil]

1 hour ago, BritManToo said:

That's right!

 

Pattaya not Lusaka!!!

[BayArea]

27 minutes ago, carlf said:

I'm surprised that I don't read more about trying to entice more Japanese to come on holiday here.  It's a huge generalisation, but they are usually great customers: well behaved, don't make trouble, spend quite a bit, and not so far away.  And they just recently opened up Japan for quarantine-free entry FOR THE JAPANESE who are abroad (not yet for the non-Japanese tourists to enter Japan).  So I'm guessing that a lot of Japanese are looking to go on holiday now, and Thailand still has a pretty good reputation amongst Japanese tourists, I think.

 

Agree 100%.  And just to add regarding their great customer image,  before covid, LOS was the weekend playground for Japanese men.

A 4 hour non stop flight to BKK from Tokyo for hedonism and pure debauchery.  The girls loved and preferred them over most customers because of their reputation as big spenders and great tippers. Soi Cowboy and Walking Street was their stomping ground. 

[PJ71]

7 hours ago, Jerno said:

Does Agoda explain the many hoops Tourists have to jump through to get into Thailand?  Most searched,   least followed through once the hoops are discovered.

Many hoops?

 

Not any more...

[PJ71]

3 hours ago, BritManToo said:

I see social unrest everywhere ..............

nonsense, people mentioned this at the start of the pandemic and lockdowns etc, nothing happened,