THAILAND’S protracted political turmoil is throwing 2015 contracting out of the windows, with hoteliers bracing for pressure on rates the moment some stability is in sight.
Some European buyers are said to be delaying contracting in order to swoop in on lower rates later – although all tour operators interviewed by the Daily said they are not doing so.
Premier Holidays UK, head of longhaul product, David Carlaw, said: “Due to the changing nature of our business, we are pretty much negotiating all the time on tactical promotions so (delaying contracting) is irrelevant to us.”
But as fresh bookings slow down, hoteliers are expecting the worst.
“Past experience would suggest that some operators will try to use the current Bangkok situation as a means to negotiate better deals for the whole country,” said Duncan Webb, chief commercial officer of Onyx Hospitality Group.
“The longer this political impasse continues, the harder operators will push for lower rates. To do effective contracting at this juncture will be challenging.”
Likewise, Centara Hotels & Resorts’ senior vice president sales and marketing, Chris Bailey, is bracing for rate pressure to set in later.
“I expect (rate) pressure to come when stability returns” he said. “The Tourism Authority of Thailand will have comeback campaigns and that’s when there will be expectations for Bangkok to ‘buy business back’. We just don’t know when that period will be.”
Already, buyers show they do harbour those expectations. David Kevan, partner, Chic Locations UK, said: “Once the situation is resolved, I think Bangkok will have to look at a short-term discount plan to restore client confidence.
“But I don’t think there will be countrywide discounts, unless the political (turmoil) spreads beyond Bangkok.”
Nyhavn Rejser Denmark’s direction of production (leisure), Jakob Ro Jorgensen, does not rule out pushing Bangkok hotels for lower rates, although he will “try to close contracts as soon as possible” due to the high number of requests for next season and “if needed renegotiate at a later stage”.
But Hans van den Born, managing director of Diethelm Travel Thailand, said the onus should not just be on Bangkok hotels to reduce rates, urging other stakeholders to play a part to drive longhaul traffic to Bangkok.
“Airlines are key too. Right now, I’m only seeing fare promotions for Thai outbound travel to European destinations. Airlines need to lower rates from Europe to Bangkok too,” he said.
For other stories, go to TTG Official Daily – ITB Berlin 2014
Additional reports from Xinyi Liang-Pholsena.
