PRICE increases by hoteliers in Thailand’s most popular resort, Phuket, are expected to dampen demand for the destination next year according to operators.
Although rates have only increased by 3%-7%, many say this is enough to make the beach resort uncompetitive with those in neighbouring destinations, in particular Malaysia and Bali.
Silverbird director Paul Graham said that although Thailand still offered better value for money than three years ago, the price increases would affect demand.
“Phuket hotels are now more expensive than they were two years ago and other destinations, such as Penang in Malaysia, are more competitive,” he said. “Thailand could also lose out to Bali which has been the bargain for 1999 as hotel rates there are so good.”
Kuoni product director Francis Torrilla said that partly as a result of the price increase, it was expecting only a 10% increase in business next year compared to a 30% rise in ’99 over ’98.
“This year is going to finish with a boom, but in 2000, the growth is not going to be as great because you can’t keep growing at that rate for long,” said Torrilla.
Tradewinds contracts manager Franco Sessini said he warned Phuket hoteliers the price increases would affect business from the UK, but he said they were enjoying strong demand at the moment from Australians who had switched from Bali because of Indonesia’s political problems.
The Tourism Authority of Thailand acknowledged growth in visitor numbers had slowed down, but said it was confident that following the launch of its ‘Time for Somewhere Timeless’ advertising campaign in the UK in September the destination would continue to perform well.
Other resorts in Thailand have not pushed up their rates as much as Phuket, and these are expected to attract more business next year.
Travel 2 said cheaper Thai resorts such as Hua Hin and Pattaya were already proving popular alternatives to Phuket and Koh Samui. The operator said it is also seeing more demand for cultural tours to northern Thailand.
As a result, Travel 2 has launched its first pre-planned self-drive tours in the north. Options include a three-day Chiang Rai-Chiang Mai itinerary, a three-day trip to Mae Hong Son from Chiang Mai, and a six-day four-wheel-drive safari and river rafting tour.
Premier has introduced Rayong, south of Pattaya, both as a single-centre option and as an extension to holidays in Bangkok or Pattaya. It is also expecting to see more demand for Krabi now Thai Airways operates daily flights to the resort from Bangkok.
But Premier Holidays Asia product manager David Carlaw added: “There is a real shortage of quality mid-range beachside hotels in Krabi to meet that demand. A number of building projects are on the drawing board, but they won’t be completed until at least 2001.”
Cruises from Thailand are becoming more popular. Kuoni is featuring voyages by SuperStar Gemini from Phuket for the first time next year with prices from £1,099 per person for a 12-night package including flights, while Travel 2 has added tall ship cruises aboard Star Clipper’s Star Flyer, which will operates two seven-night itineraries from Phuket in 2000 costing from £905 for a seven-night cruise only.
Travel 2 is also featuring Star Cruises’ new SuperStar Europe which offers departures from Bangkok to Vietnam with a lead-in price of £720 per person for a five-night cruise only.
Airtours plans to enter the market in December 2000 when it will operate one of its ships, the 916-passenger Seawing, out of Phuket.
It will offer two different seven-night flycruise itineraries with charter flights by Airtours International once a week from Gatwick and Manchester to Phuket. Prices for the cruise, which will operate from December 2000-April 2001, start from £799 including flights.