Tourism industry still cannot see signs of recovery

The tourist season has begun but signs of sector recovery are few and far between.
The number of foreign tourists to Vietnam in the first nine months of 2009 decreased by 16.6 percent over the same period of the previous year. Eight out of Vietnam’s biggest 10 markets have seen the number of tourists decrease sharply, including China, the US, South Korea, Japan, Taiwan, Australia, Malaysia and Thailand.
Number of tourists on the decline
Fiditour, Ben Thanh and Lien Bang travel firms, are united in their belief that the number of international tourists to Vietnam from now till the end of the year will decrease by 10-15 percent over the same period of 2008.
Saigontourist, which holds 80 percent of the inbound market share, said the firm is serving some 32,000 foreign tourists this season – that is a 6-7 percent decrease over the previous season.
The lower number of tourists has led to a lower occupancy rate at hotels. One marketing director of a four-star hotel in HCM City said that in general, the highest hotel room occupancy rate could be seen in November every year. Meanwhile, the occupancy rate for November 2009 is set to be only 50 percent. That is a 20 percent lower than last year.
The director of Majestic Hotel, Tao Van Nghe, said the occupancy rate of his hotel decreased by 17 percent in the first nine months of the year compared to the same period the previous year. Meanwhile, the occupancy rate for the last months of the year is expected to see a slight increase.
While Vietnam’s tourism industry is still suffering from decreasing numbers of travelers, Thailand’s tourism has seen signs of recovery. According to TTG-Asia, a tourism and economics journal in Asia, the number of passengers flying to Asia has been increasing significantly. All the air tickets for flights from Germany to Thailand this winter have been booked already.
High tour fee is the reason
A new survey conducted by Saigontourist showed that the global economic crisis has influenced European tourists the most. However, tourists tend to reduce travel expenses rather than doing without a holiday. Therefore, special cheaper promotions may still be able to attract travelers from the US and Europe.
The survey may prompt travel firms to try to reduce tour fees. The firms themselves have admitted one of the reasons behind the decreasing number of foreign tourists to Vietnam is the high tour fee.
According to Tu Quy Thanh, Director of Lien Bang Travel Firm, the tour fee has decreased by 30 percent over the previous year under the framework of the ‘Impressive Vietnam’ campaign which aims to lure more foreign tourists to Vietnam. However, it is still 20 percent higher than other regional countries.
Meanwhile, director of Saigontourist Vo Anh Tai said tour fees remains high because travel firms, air carriers, hotel and other service providers still have not sat together to discuss fee reductions to create competitive packages.
Travel firms are complaining hotel room rates remain high. However, hotels in Nha Trang and and Thiet are refusing to reduce rates, while the hotels in HCM City have accepted slight decreases only.
According to hotel property experts CBRE, the average hotel room rate at luxury hotels in HCM City is now $118 per night, while Thai five star hotels are offering $80 per night only to Vietnamese travel firms.