Travel Industry Still Struggles Despite Easing of Restrictions

While overseas travel started to pick up after strict Covid-19 restrictions were lifted worldwide, tour operators continue to face numerous challenges linked to new viral outbreaks and current economic issues.

According to the Thai Travel Agents Association (TTAA)’s president Charoen Wangananont, outbound tourism just started to show signs of improvement as cases led by Covid-19 BA.4 and BA.5 subvariants began to rise in key markets, such as Korea and Japan.

The new infection wave could slow down full reopening in those countries, especially Japan, as it imposes strict travel restrictions to prevent the disease from spreading further,  he explained.

Outbound travel to Europe has also been affected by the strict and time-consuming requirements to obtain a visa. However, the TTAA plans to meet with the Foreign Ministry and embassies to resolve the issue.

Expenses related to coronavirus, airfares and higher cost of living also impacted operating costs for outbound travel, causing a 30-40% increase on average. Consequently, it directly affected budgets and travel frequency for low- and middle-income segments.

Mr. Charoen said tour operators might cut their margins to attract tourists, but they continue to suffer from rising costs despite improving travel confidence.

The TTAA encompasses more than 900 tourism businesses, including 90% that have already resumed operations. However, most of them cannot work as in the pre-pandemic period.

The association’s Vice-President Thanapol Cheewarattanaporn explained that tour operators hoped to see their business pick up and become solid until the Omicron variant emerged late last year. A new and delayed opening of key Asian markets also hampered their rebound.

Although the number of trips abroad has gradually increased, the demand remains inconsistent. Furthermore, most tourism workers would not return to work due to a lack of confidence, he added.

Somchai Chomraka, president of Weekend Tours, said airfares for group reservations for European destinations rose by 5,000-6,000 baht, while the price to short-haul destinations has increased by 1,000-2,000 baht, further affecting outbound travel.

However, tour operators must wait until October to see the actual flow of overseas travel demand, Tour Operator Network Association’s president Jitakorn Wijannarong said.

The TTAA plans to meet with retailers and wholesalers to discuss pricing standards for package tours, travel insurance and incentive programs to attract more tourists.

In the meantime, tour operators can focus on Southeast Asian destinations, as generating tourism within the region can help sustain the business, Mr. Charoen stated.