Wednesday, April 24, 2024
HomethailandgeneralHotels unable to improve room rates

Hotels unable to improve room rates

Hotels in major destinations overall have been unable to improve the average daily room rate during the high season, due to the slow rebound of the mass market, according to the Thai Hotels Association (THA).

Sanpech Supabowornsthian, president of THA’s Eastern Chapter, said hotels in Pattaya and the eastern region previously wanted to offer rooms at the same rate as 2019’s level during the high season after seeing a healthy rebound in international tourism.

However, they have received more requests from travel agents asking for discounts.

Mr Sanpech said only international hotel chains or branded hotels have been able to raise room rates higher than 2019’s level, while the majority of those under three- to four-star have had to maintain their prices.

He said this situation is attributed to the slow recovery of mass tourism from many key markets, such as Russian groups which have become more sensitive to prices due to the weak ruble.

The Chinese market has also rebounded slowly due to domestic economic pressure, competition from domestic travel within China, as well as the persisting unsafe image of Thailand.

With fading pent-up demand and the reopening of more countries, he expects the room rate in Pattaya and the whole eastern region would remain below 2019’s level by 10-15%, which slightly improved from the low season.

He said there would be no price war this winter as hotels have to adjust their prices due to the increasing operating costs.

The THA’s nationwide survey for September found three-star hotels and below still face limitations in terms of adjusting the average daily room rate.

Hotels in the East and the South were able to raise their rates more than other regions, such as those in the North.

“Chiang Mai hotels have been suffering from a price war during the low season,” said Paisarn Sukjarean, president of the THA’s Northern Upper Chapter.

Mr Paisarn attributed this to oversupply and the slower than expected international rebound, especially from the Chinese market who were not confident about travelling to Thailand, as well as the lack of tour groups.

He said four- and five-star hotels, accounting for 20% of the province, also reduced rates to attract tourists, leading to a further rate reduction in the lower hotel segment.

He said most tourists who can afford to travel tend to choose upscale hotels first, widening the recovery gap for each segment.

The overall average room rate for Chiang Mai was still 15-20% less than the pre-pandemic level, he said.

However, Mr Paisarn said operators still expect a gradual recovery, as they observed from the forward booking pace of domestic and foreign tourists during the upcoming festivals.

Apart from the Chinese, foreign tourists who visited Chiang Mai included Europeans and South Koreans.

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