Thread: Thai Hotels Face 111 Million Baht Loss After FTI Group Insolvency

On June 12th, 2024, Mr. Thienprasit Chaiyapatranun, president of the Thai Hotels Association (THA), addressed the impact of the insolvency of FTI GROUP, a major German tourism operator, on Thailand’s hotel industry.


FTI Touristik GmbH, the third-largest tour operator in Europe and parent company of FTI GROUP, filed for insolvency with the Munich District Court on June 3rd.


In the wake of this development, the THA conducted a survey to assess the financial impact on hundreds of Thai hotels, which amounted to a cumulative loss of 111 million baht.


Hotels in Bangkok faced losses of 12.72 million baht, the northern region 632,244 baht, the eastern region 4.04 million baht, the western region 888,151 baht, and the southern region 92.88 million baht.


Thienprasit noted that the insolvency has led to a loss of confidence among hotel operators in dealing with international travel agencies, which had previously received advance credit. From now on, travel agencies might face difficulties as hotels may now impose stricter credit limits or refuse credit altogether.


This situation disrupts the marketing balance, particularly since the German market is a crucial segment for Thailand, remarked Thienprasit.


Thousands of tourists were directly impacted, having already paid their accommodation fees to the tour company. Consequently, these tourists refused to cover additional expenses for the rooms they had booked in advance at Thai hotels, placing a financial burden on the local establishments, remarked Thienprasit.


As a result, many Thai hotel operators are likely to shift towards online travel agencies (OTAs) that do not require advance credit. Additionally, there is an increasing trend towards using payment gateway systems for enhanced convenience and security.


Tourists may also prefer direct bookings with hotels, airlines, or OTAs over traditional travel agencies.
In response to this significant event, Thienprasit urged the Tourism Authority of Thailand (TAT) to proactively provide information to the private sector and implement support measures to mitigate the economic impact.


Thai Hotels Face 111 Million Baht Loss After FTI Group Insolvency - The Pattaya News

Well, they have some farangs to blame now.

And you can bet that the TAT will make the most of it.