Slumping economy curbs summer travel boom

By Tu Nguyen   May 18, 2023 | 02:01 am PT
Slumping economy curbs summer travel boom
Foreign tourists walk in Hoi An ancient town, May 2023. Photo by VnExpress/Dac Thanh
While last year's post-lockdown summer holiday season made for bustling travel, this year travel businesses are fretting over declining revenues once again as a gloomy economic outlook has dampened demand.

A representative of a travel agency based in Hanoi said on Sunday that every year, about 70% of his company’s customers book tours a month in advance for their summer holiday break.

This year, the company's tour bookings for June are still 40% empty, and the figure is 30% for July.

Hoang Tuyet, general director of Hanoi-based Top One Travel, said that last year it was difficult for his company to find enough hotel rooms for its abundance of customers travelling during the peak season

But "everything has changed this year" as the number of guests booking hotels dropped, Tuyet said.

Tran Phuong Linh, director of the marketing and technology department at HCMC-based agency Benthanh Tourist, said many travelers are no longer as eager to book tours in advance as they were last year.

Due to inflation and the excessive cost of goods and service across the board this year, tour package prices for the summer holiday have also skyrocketed.

Tuyet said the gloomy economic outlook has many tourists opting for destinations near home to reduce air travel costs this summer.

Her customers are interested in destinations that can be reached by car from Hanoi such as Ha Long Bay and Ninh Binh Province.

A travel agency representative said economic difficulties have prompted many businesses to cut down on entertainment and travel costs.

He thus predicted a significant decrease in MICE tours (meetings, incentives, conferences, and exhibitions) this summer.

He said the number of MICE tour groups this year has so far reached only 60% of last year's figure due to surging travel costs. The lack of MICE guests has put his company in crisis mode as MICE revenue usually accounts for 44% of the summer total.

"MICE groups always bring great revenue to tour operators," he added.

Experts have yet to predict when the weakening purchasing power of Vietnamese tourists may stabilize again.

The top travel concerns of Vietnamese travelers for this summer were the weather and prices, according to a summer travel plan study of 500 Vietnamese respondents conducted by Milieu Insight, a consumer research firm focusing on Southeast Asia.

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