PHUKET, 16 July 2018: Gauging the financial fallout from the Phuket boat disaster that claimed 47 lives, earlier this month, varies dramatically depending on who the reporters interview.
The Bangkok Post at the weekend estimated the island would lose 7,300 room nights and placed the value at around THB7 million. In contrast, Thai PBS TV said the island stood to lose TH42 million.
Government estimates suggest a loss to the island’s economy over the next three to four months could top THB350 million.
The timeframe for these varying estimates vacillates between a month and three months.
Take your pick on the damage assessment, but whatever the slant you give it, the bottom line for Phuket’s tourism is written in red ink possibly until the next peak season begins late October.
Hoteliers commenting to TTR Weekly admitted that bookings from China’s tour operators were already in decline April to June, long before the accident. However, they argued that bookings were beginning to pick up again by early July, during the week when two tourists boats capsized in a monsoon season storm.
The passengers on the tourist boat, Serenita, escaped, but the loss was high on the other boat the Phoenix resulting in the death of 47 passengers and injuring another 56.
To illustrate the importance of the Chinese outbound travel market for Phuket, C9Hotelworks in its latest market report noted 23 new airline routes were established up to May this year, of which 19 were from mainland China. Overall, 33 Chinese cities have flights to the popular holiday island.
Advance booking trends suggested July and August, two months when China’s schools take their summer breaks, would get the market back on track.
Annually, the island welcomes around 3 million Chinese visitors of the 10 million who visit Thailand, but like all the figures it’s an educated guess.
The mechanisms that control tours from China are difficult to understand, so evaluating Phuket’s loss is punctuated by heaps of disclaimers and exceptions.
The Ministry of Transport and the Ministry of Tourism and Sports are pitching in to resolve loopholes in the law and bring some order to the island’s boating industry that has been blighted with accidents and corruption allegations.
The Ministry of Tourism and Sports permanent secretary, Pongpanu Svetarundra, told Thai PBS TV he anticipated Chinese tourist arrivals to the island could fall by 10 to 15% from the annual 3 million visits. It could amount to 300,000 to 450,000 holiday bookings lost.
But the forecasts are speculative based on gut feeling and confused by the variables in tour itineraries. In one segment, such as individual upscale travellers, the impact might be negligible, while in the low-priced charter holiday market it could be catastrophic.
Reports surfaced that charter flights cancelled when it became apparent Chinese tour operators could not fill up seat allotments for flights over the next two months.
But that does not mean the entire island’s hotel sector suffers massive losses. It largely depends on the tour operator’s itineraries. If the tour price featured island hopping by boat in the package then it was very likely that bookings plummeted.
Most of the Chinese tour packages feature a mix of hotels, town hotels or ones near the boat jetties and then a single or two-night stay at a west-coast beach hotel, most likely on Patong bay.
“If you look at just the holiday bookings for the island without a boat trip component, we are still getting bookings,” a Patong bay hotelier explained.
Patong Bay hotels will probably lose a one or two-night stay out of a four-night package.
If the the groups arrive after midnight on a charter from China they will probably stay at a Phuket town hotel, to allow an easy transfer to the boat jetty after breakfast. City hotels will suffer as the packages usually include a boat excursion.
Independent Chinese travellers, possibly booking with Ctrip, or CCT Express, are less likely to cancel their trips. They usually book one hotel at the beach for their entire stay.
Chinese tour operators book allotments with Phuket hotels that require confirmation of the guest list around 30 days before arrival.
“They have a series of 40 groups with my hotel over the next three months with around 30 guests in each group. Since the accident we lost bookings for four of the groups,” a Patong Bay hotelier explained.
To compensate, west-coast beach resorts on the island have an opportunity to draw bookings from other markets such as Indonesia, Vietnam, Malaysia and India.
Guests from these markets book their own sightseeing and visits to theme parks or attractions. They will probably take a rain check on boat trips.
China’s structured tour packages if they include boat trips will take a hit, but independent travel bookings (airfares and hotel stays) during China’s summer school break could recover if prices remain competitive.
But in a comment last week C9 Hotelworks’ Bill Barnett warns “it would be ignorant to not understand that Baidu (the Chinese Twitter) and highly influential (Chinese) bloggers are having a field day at tourism Thailand’s expense.
“Every manner of public forum is now filled with commentary, talking about threatened boycotts, poor tourism safety and a general lack of sympathy for Chinese visitors. It’s dark, ominous and extremely damaging.
“Safety and security of tourists should be one of the highest priorities for the industry and understanding our customers who, despite not appearing in Thai or English media news, are clearly in crisis and cannot be ignored.”
(Source: Bangkok Post, Thai PBS, C9 Hotelworks)
Safety first can not be assured if they are only on the alert or respond only when the damage has been done. They must ensure safety first at all times for its own sake; always the priority at every level. And they don’t think only to compensate the lives lost, or those who are injured with money to calm down people, but think carefully and act to ensure safety first always comes first.