Hotel business slumps as peak season nears

Tashi Dema

The e-mail alert tone on his IPhone has never concerned hotelier Ugyen (name changed on request) so far. But with agents and tourists shooting e-mails to cancel their reservations, it pains Ugyen to hear the alert tone.

The global coronavirus outbreak, known as COVID-19, is now eating into the business of the hotel industry after tourism and airline, all of which are in the service sector.

Although February is considered a lean season for those in the industry, hoteliers said the number of guest drastically reduced after the outbreak of the virus that was declared endemic last month.

Hotel owners said that regional tourists and agents cancelling bookings are worrying them more, as they fear there will be no guests during peak season.

An hotelier in the heart of Thimphu town, Sonam Dorji, said most of the small hotels are on the verge of shutting down and relieving their staff because of low occupancy.

He attributes it to the coronavirus outbreak, which has created fear among tourists and also the Parliament’s approval of sustainable development fees (SDF) on regional tourists.

The board member of the hotel and restaurant association of Bhutan (HRAB), Sonam Dorji said there are more than 623 registered hotels with the association and they contribute the third highest revenue to the economy. “If this trend continues, the economy will be severely affected.”

He said tourists are cancelling the bookings and they only have expatriates, who are in the country for official duties like corporate auditing, coming for lunch. “Otherwise, the rooms are empty.”

On the outskirts of the city, a three-star hotel, Norpheling Hotel just recruited four staff to prepare for the busy tourist season.

The hotel received confirmation for eight groups of tourists, about 50 people, including 16 Americans.  12 cancelled the booking.

General manager, Chimi Peday is worried. “We lost business in February and looked forward to March, which is the peak season,” she said.

The hotel cannot charge for cancelling the booking. “If it is for other reasons we charge them, but this time it is because of the outbreak of coronavirus and we cannot,” the general manager said.

On the implication, Chimi Peday said a group of five people who stay for three nights could earn them a salary for at least two staff. “With the cancellations, we are worried about paying our loan and staff salary,” she said. “We depend on tourists and if this continues, we are going to be in trouble.”

The hotel, to staff afloat, started schemes to attract local guests. Heavy discounts of rooms and other services are some of the strategies.

Migmar hotel saw one group and two Chinese tourists cancel their bookings.

The impact is not just in Thimphu.

An employee of Risum Resort in Haa said that three regular agents have cancelled the booking attributing it to the global coronavirus outbreak. While the resort was seeing many cancellations, she said many agents did not mention the reason.

She said that they were suspecting that the cancellation is because of the outbreak of the virus.  “Since it is off-season, we cannot measure the impact of the outbreak yet.”

In Paro, where everybody is looking forward to the Paro tshechu, hoteliers are experiencing booking cancellations.

Tashi Namgay Resort, a popular three-star hotel is experiencing cancellation every day from both local and foreign agents.

Resort employees said many Chinese tourists had already cancelled their bookings and tourists from Europe and India are also now cancelling bookings. “Some are cancelling because some airlines of their connecting flights have been shut down in some countries.”

Hotel Olathang, one of the oldest hotels, reported only f cancellations.

A staff of the hotel said that as cancellations were of small groups, there were no major implications on the business. “If it was big group, it would affect us.” The three-star hotel has 78 staff.

Some hotels in Phuentsholing are also seeing cancellation because of the fear of having to travel through Jaigaon while they also see many Bhutanese also cancelled because of the similar fear.

World Health Organisation (WHO) declared coronavirus an international health emergency on January 30 although it showed its signs in December last year.

The virus has since then affected the hospitality industry much like the other industries like airlines and cruises worldwide. The two airlines in Bhutan also reported losses in millions because of the outbreak.

Bhutan did not put a ban on any international tourists and the health ministry has declared that no one tested positive for the virus as of yesterday.

0 replies

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply