Songkran holidays : “room reservation rates decreased by more than 40 %”

The Association of Domestic Travel revealed that the economic crisis has had an effect on hotel bookings for Songkran days this year.

Association of Domestic Travel president Maiyarat Pirayakoset said that 3-month tallies of tourism figures show stagnation as the world’s economy slows down, and that people are spending about 50 per cent less. It has effected the hotel industry, which reports that room reservation rates have decreased by more than 40 per cent.

The president of the Association of Thai Travel Agents Apichart Sankary confirmed what Maiyarat said, adding that room reservations have dropped by more than 40 per cent, compaired with the same period last year. Chinese tourists who leased more than 60 private flights last year, have leased only 30 flights this year. (TOC)

I don’t really trust this kind of feedback. Because those people are the same who ask for help from the government, therefore their interest is to make us cry.

But in any case, they don’t lie about the trend. They can’t lie about the trend. And my friends, the trend is all what matters. This is one of the ideas I’m toying with on this blog since a few months.

The trend is negative. The trend is a freaking negative loop, a non linear process, a self reinforcing process…

The trend makes the politicians look like fools.

Abhisit sees “yields” for his stimulus plan in 2 or 3 months. Trichet sees recovery on Q4. Bernanke too. Obama sees everything in pink. Geithner sees nothing at all… The Big Clowns Circus is pumping like crazy. Coming to your neighbourhood soon.

Anyway. The thais officials were thinking that tourism would bail them out from the exports slump… The foreigners would come to Thailand by A380 loads… Sabai.

But those brainless people forgot something : during a recession, what is the first budget people cut ? … holidays. Of course.

Just plain common sense. Even a high schooler knows this. But no, the clowns don’t.

What happens when a millionaire sees his stock portfolio melting ? When Joe The Plumber loses his job ? When a business owner loses 25 % of his turn over ? Do they continue to come to Thailand and spend the money they don’t have anymore ? A few yes. But other don’t.

And what is true with the foreign visitors is also true for the local tourists. Obviously.

Therefore, expect no miracle from tourism, as far as GDP growth is concerned.

Chart, tourists arrivals until september, and glimpse on Q4 2008

The Office Of Tourism has updated the data until september for the total of international arrivals (by air + land + sea), and until december for the airport of Suvarnabhumi.

First the chart by month, with the figures and the percentage of change year on year (compared to the same month of the previous year).

And then per quarter.

What about Q4 ? Right now we have only the data for the airport of  Suvarnabhumi (= 73 % in average of all the international tourists arrivals in Thailand).

The figures aren’t good (closure of the airport 1 week in november, and 5 days in december).

October : 749 976
November : 687 625
December : 646 321

International air traffic : “unprecedented and shocking” free fall in december (passengers and freight)

Another “unprecedented” news (read here). I told you : it’s every day now.

International air freight traffic plunged by 22.6 percent on the year in December, an ‘unprecedented and shocking’ free fall, the International Air Transport Association said on Thursday.

‘There is no clearer description of the slowdown in world trade,’ it said in a statement, adding that international passenger traffic had dropped 4.6 percent year-on-year.

For the full year of 2008, international air cargo traffic was down 4 percent, while international passenger traffic posted modest gains of 1.6 percent, according to the Geneva-based body. (Forbes)

And what about sea freight ? Unprecedented too in Thailand (read here). Thai exports results ? “Unprecedented” too.

So ask yourself : how are going to be january, february and the following months ? “Unprecedented”. And how will be the crisis fallouts ? “Unprecedented”.

You want more ? Yesterday, USA… Philly Fed Index was published. “Unprecedented” low.

You want more ? Yesterday, USA, “Record Low New Homes Sales in December“.

More ? Today, Japan : “Factory output slumped an unprecedented 9.6 percent in December“.

Do you start to understand ?

Whether we received data in value, volume, or percentage of growth year on year, month on month, moving average etc… we get “unprecedented” readings. More and more.

The black swans are multiplying.

[Have a look on this blog... 20 charts with data released in january to show the on going economic disaster in the USA].

Airports traffic dropped in november (and no, the blockade was not the only reason)

As expected November passenger traffic through six airports managed by Airports of Thailand showed declines exceeding 27%, down by more than 1.4 million passengers.

The official air traffic report, released by Airports of Thailand for November, revealed the extent of damage caused by the closure of the two Bangkok airports over the last five days of the month.

Suvarnabhumi and Don Mueang airports were closed from 25 November until 5 December. [...]

Suvarnabhumi Airport. Closed for five days aircraft movements plunged 18.87% from 21,288 to 17,272 —international, down 18.78% , domestic down 19.29%. Passengers in November shrank 26.05% from 3,526,794 to 2,608,199 — international passengers down 28.81% while domestic fell 12.21%. (TR Weekly)

We need to compare orange with orange, and a month of 25 days with a month of 25 days (Suva was closed during the evening).

And passengers data are better than aircraft movements (because year on year, airlines have canceled some routes, and reduced their capacities).

Last year, average per day was 3 526 794 / 30 =117 559. Times 25 = 2 938 975. So this is our comparison point.

Therefore, without the blockade, the number of passengers Suvarnabhumi Airport dropped by 11 %.

Which is perfectly in line with the… figures for october (a drop of 11 % read here).

The report of TR Weekly contains other interesting figures for Don Muang and the regional airports (Chiang Mai, Chiang Rai, Phuket).

The domestic traffic has suffered a lot.

New visa drama : from 30 days stamps to 15 days at land borders

Here we go again… The forum ThaiVisa is hot like lava… The reason ? A new “visa drama” of course !

From time to time, the thai authorities love to toy with visa regulations… To change the rules… If possible without warning (it’s much more sanuk).

This new police order was issued on november 25. But the “news” (in english) came only wednesday… In a way it’s highly ironic to see the thai police playing with visa regulations during a full blown tourism crisis…

By the way :

The TAT is also preparing an advertising campaign called “Apologies Thailand”, aimed at redressing the damage by the political turmoil and the Suvarnabhumi and Don Mueang airport closures. The agency will use the campaign to send a positive message to tourists around the world, encouraging them to come back to Thailand. (Nation)

The TAT should talk to the police…

As usual, don’t try to understand. Because maybe there is nothing to understand. AKA : no conspiracy.

So what the new fuss is about ?

30-days border runs now only 15 days

In order to limit the amount of foreigners using “back-to-back” border runs, Thai Immigration has issued a new regulation regarding the 30 days tourist exemption.

Effective immediately, travellers without visa will get only 15 days of stay if they are arriving via a land border checkpoint from a neighboring country.

Passengers arriving via an international airport will obtain a 30 days stay, and for them there is no change.

This police order number 778/2551 is today confirmed by Royal Thai Police, Immigration Bureau, in Bangkok.

So if you’re a poor backpacker enjoying long trips and land borders, or a “visa runner”, you probably already found the link of the ThaiVisa forum.

Overall, there is without any doubt a political will to make it harder for foreigners who took for many years some liberties with laws…

The problem is : this will is often muddled, incoherent. And sometimes hypocrite too.

Anyway : times change.

UPDATE
Apparently, there are new regulations too for ” Extensions Of Non-immigrant Visas” (read here).

Airport traffic falls 11 % in october

Passenger flows through airports operated by Airports of Thailand Plc (AoT) including Suvarnabhumi last month totalled 4.23 million, 11.29% lower than in the same period last year.

Flight movements fell 11.57% year-on-year to 29,365, while freight throughput slipped 9.56% to 107,129 tonnes, according to figures compiled by AoT.

But the rate of contraction in October was less steep than the 20% drop in passenger numbers seen in September, a four-year low, which was partly a response to the prevailing political unrest at the time.
[...]

Passenger traffic in September fell 20.2% year-on-year to 3.47 million while aircraft movements shrank 15.8% to 26,832 and cargo contracted 8.75% to 107,909 tonnes. (Nation)

This is in line with the figures of international arrivals for tourism (read here).

The real test starts now with the high season. We don’t have the oil crisis anymore, but the political situation is still worrying. And of course tourism could suffer from the fallouts of the global economic crisis.

Chart, tourists arrivals, 2008 : good Q2 but shadows on Q3

Back in business ! I’ve found again the statistics for tourists arrivals (read here). The Office Of Tourism set up a new website, took the old figures from TAT, and started to publish the new data for 2008.

That’s a good news.

However, from a monthly rythm we are now on a quaterly basis for the publication. So, we will have to be more patient.

Here is an update of my chart with the figures until june 2008. As you can see Q2 was good with an average growth year on year of 10 %.

“International tourists arrivals” = total of foreign visitors coming to Thailand (by air, sea ports and land borders).

What about Q3 ? We can have a “taste” of it by looking at another set of data published before : “International arrivals at Suvarnabhumi Airport” (I guess the computers at Suvarnabhumi allow a faster data collection).

We have a drop of 16,1 % compared to Q3 2007.

Roughly 75 % of tourists arrive through Suvarnabhumi Airport, therefore it’s a good indicator for the number of total arrivals. We can say that Q3 will be bad.

Between the oil crisis last summer and the political crisis (several countries advise their nationals to avoid travelling to Thailand)… we can find many reasons for such a drop.

However, the big test is going to be Q4… the high season… and we will all look for the fallouts of the global financial crisis.

Stay tuned.

Thai Airways : “the situation seems to be getting worse”

After “biggest quaterly losses in 10 years and plan to reduce workforce” (august) and after “The situation has deteriorated from bad to worse” (october 10), here is the latest episode of the Thai Airways Drama :”The situation seems to be getting worse”.

Thai Airways International must drastically slash costs more in order to weather the slump in travel demand caused by the worsening global financial crunch and the political standoff in Thailand.

”The cost-saving measures we have adopted are not enough as the situation seems to be getting worse. More drastic action is needed,” THAI president Apinan Sumanaseni said yesterday.

Facing reduction are intercontinental services where it must fill at least 70% of its seats to break even, and several regional routes to China, Korea and Japan on which traffic has fallen sharply.

Acquisitions of aircraft that have not yet been ordered will be reviewed, though those already committed, including six Airbus A380 superjumbos, eight A330-300 wide-body jets and 20 A320 regional jetliners, will not be subject to change.

But Mr Apinan ruled out retrenching staff due to complicated state-enterprise protection rules, but 400 personnel recently accepted voluntary early retirement costing THAI 700 million baht. There are 26,000 people on payroll. (Bangkok Post)

Apinan has an impossible task : to save a “national carrier” during a global and local crisis, without touching one hair of the… employees (who are for a lot of them relatives, friends, cousins, maids of generals, colonels, politicians and other lunatics officials).

Good luck. And check the parachutes.

-SIngapore Airlines has 99 airplanes and 14 000 employees
-Thai Airways has 88 airplanes and 26 000 employees…

Just another regular and perfectly normal day in the Land of Smiles…

Suvarnabhumi airport arrivals plunge 30% in one week ?

Passenger traffic at Suvarnabhumi Airport has plunged since the state of emergency was declared in Bangkok on September 2.

Arrivals have dropped by 30 per cent compared to the week before the announcement, the Federation of Thai Travel Associations said yesterday. (Nation)

30 % ? ! That sounds a lot… It would be interesting to check with the figures from Immigration. Unfortunatly, those figures are not published anymore (read here).

And what about the split between domestic and international ?

Suraphol Sritrakul, executive director of the Association of Thai Travel Agents, said tourists from Malaysia had already declined by 80 per cent.

Elsewhere in the region, Singapore was down by 50 per cent, Vietnam by 90 per cent, China by 80 per cent, Japan by 10 per cent, Hong Kong by 60-70 per cent and India by 40 per cent.

In the long-haul market, Holland was off 20 per cent, Germany 15-20 per cent, Russia 30 per cent and Egypt 30 per cent.

Holland 20 % off ? In one week ? It’ strange. For long haul, people don’t buy your ticket a few days before departure… And I don’t believe that tourists from Europe were afraid, to the point to cancel en masse.

I think other factors could explain the lower number :

-low season . From mid to end of august, Suvarnabhumi airport is super busy (with the end of summer hollydays in Europe, USA etc.). So, mechanically, the week after, there is a drop in %…

-and frugality. Economic slowdown. In july, the traffic was already down from Europe compare to the year before (read here). And at that time, the problem was more tickets prices, fuel surcharges, etc.

Therefore, to put everything on the shoulders of the political crisis now is, I think, a mistake.

Tourism : “number of long haul visitors has declined by 10 %”

Tourism-related operators must focus on short-haul tourists to offset a falling number of long-haul tourists, who have been hurt by soaring travel costs. Prakit Chinamourphong, president of Thai Hotels Association (THA), said the number of long-haul tourists, particularly from Europe, has declined by 10% since the start of the year as higher oil prices have increased travel costs by over 30% from last year.

The number of chartered flights is decreasing significantly due to rising fuel surcharges. However, the number of short-haul tourists is growing. (Bangkok Post)

It’s very unfortunate that TAT (Tourism Authority of Thailand) has stopped the publication of the statistics of international arrivals (by country and port of entry)… Last datas are for… december 2007.

Before, it was easy to follow the situation, with only 2 months time lag, and creating nice charts…

Now we have to rely on bad reports from the thai press, and selected datas…

What do they want to hide ? Is there something to hide ?

Give us back our stats !

Air traffic : passengers flows and aircrafts movements decline since may

Signs of a slowdown in air traffic through Thailand’s six main airports clearly emerged last month as spiking fuel oil prices and low-season demand forced airlines to cut flights.

Passenger flows through Suvarnabhumi, Don Mueang, Phuket, Chiang Mai, Chiang Rai and Hat Yai airports was 4.21 million last month, versus 4.56 million in May and 5.04 million in April, according to figures from Airports of Thailand Plc (AoT).

International passenger flows slowed from 2.89 million in May to 2.77 million in June. But the overall total for the first half was up a healthy 8.77% to 19.12 million.

Domestic passengers showed a dramatic slowdown, with growth of merely 1.79% in June (1.44 million), down from 9.71% in May (1.66 million).

Combined aircraft movements declined from 33,779 in April and 33,356 in May to 30,607 in June. [...] (Bangkok Post)

The article emphasizes the fact that cumulative numbers  on the first 6 months remain positive, with a growth year-on-year. But it’s irrelevant. That’s the past. What is important is the change of the trend in may and june.

The party is over. Inflation leads to… deflation. That’s the fascinating beauty of the current economic situation.

People’s purchasing power is battered by higher prices of goods and services… disposable income is declining. Therefore, people have to cut some of their expenses.

And clearly tourism and air flights are non-essential expenses…

This situation forces airlines (already) to cut flights. That will lead to unemployment, less taxes paid, lower economic growth etc.

Again it shows perfectly the risks the world faces : a deflation-depression.

We will consume less, therefore companies will produce less, invest less, GDP growth will go down… and even in negative territory… leading to lower income… leading to falling prices… leading to write-off of overvalued assets… leading to lower income etc.

We have had an insane bullish run since many years… and many bubbles. Crisis times are coming now.

It’s just the beginning of the other side of the cycle.

A vicious cycle.