Thais ground overseas travel plans amid squeeze on spending power
Thailand's outbound travel market is experiencing a slowdown in the second half of this year due to a decline in consumer spending power, according to Charoen Wangananont, president and board committee member of the Thai Travel Agents Association (TTAA).
In an exclusive interview with Krungthep Turakij, Charoen explained that economic uncertainties had prompted many Thais to postpone overseas travel plans to avoid additional expenses during the downturn. As a result, the TTAA anticipates a subdued outbound market for the remainder of the year, with the typically busy fourth quarter expected to be particularly weak.
"We initially projected that around 7-8 million Thais would travel abroad in 2024, well below the 12 million in 2019 before the Covid-19 pandemic. However, we need to reassess the situation based on the performance of the fourth quarter," he said.
To stimulate the market, the TTAA typically organises two major consumer travel fairs – the Thai International Travel Fair (TITF) – in Bangkok each year. However, due to the current economic climate and weakened consumer spending, the association has cancelled this year's mid-year event for the first time in a decade. The next TITF is scheduled for January 16-19.
Despite the overall downturn, China has emerged as a popular destination for Thai travellers, primarily due to affordable tour packages. The implementation of a permanent visa exemption between Thailand and China from March 1 has contributed to a significant surge in visitor numbers, with an estimated 1 million Thai people expected to travel to China this year. However, Charoen cautioned that the China market may slow down in the coming months.
Japan is projected to be the top destination for Thai tourists in 2024, with an estimated 1.2 million visitors. Other popular destinations include Southeast Asian countries such as Malaysia, Vietnam, and Laos, while traditional favourites in East Asia, including South Korea, Taiwan, and Hong Kong, have slipped out of the top five.
"The shift in travel preferences reflects the financial constraints faced by many Thais. With limited budgets, travellers are opting for cheaper destinations within the ASEAN region or other parts of Asia. Tour operators must adapt their packages accordingly, offering more flexibility and budget-friendly options," he explained.
South Korea's strict K-ETA (Korea Electronic Travel Authorisation) system has also impacted travel demand, with visitor numbers expected to reach only 300,000-400,000 this year. Meanwhile, the high cost of European tour packages compared to pre-pandemic prices has deterred many potential travellers.
Thanapon Chewarattanaporn, managing director of Quality Express Co Ltd and TTAA vice president, highlighted the significant growth in China tour package sales since the introduction of the visa-free regime. China's diverse tourist attractions and strong safety record have contributed to its popularity.
While Japan has enjoyed a strong start to the year, concerns over rising prices for tourists could impact bookings in the second half. He predicted that Japan would remain the top destination for Thai travellers in 2024, followed by China and other Asian countries.
Despite the challenges facing the outbound travel market, he said the upcoming Olympic Games in Paris has generated some interest in France, although safety concerns and visa restrictions remain obstacles.
