Hua Hin’s Domestic Driving Market Expected To Attract Early Demand

As Thailand starts to look at a calculated resumption of domestic travel, Hua Hin, South of the Bangkok metropolis is well poised to capture pent-up demand due to the old adage – ‘location, location, location’.

As the current Covid-19 crisis moves forward and tourism remains on the cusp, driving destinations appear to have a clear-cut advantage in seeing travel re-opening. Both overnight stays and day trips look to be the agents of change in the short-term.

In the newly released report Hua Hin Hotel Market Update from C9 Hotelworks, the findings conclude that the bottom line for the destination’s international tourism ambitions are highly leveraged on the current airport expansion plan.

Looking back, Hua Hin has continued its journey down a sustainable path of tourism visitor arrivals with a 5-year CAGR of 6%. Despite the upward trajectory, last year 74% of visitors came from the domestic sector.

For hoteliers that has not been all bad news as according to data from STR, the market-wide average room rate has held at the THB4,000 level. In many of other Thailand’s resort destinations rates have been flat or in some cases retreated in the face of mass tourism and appreciation of the Thai baht.

Back on the domestic front, as the main market feeder, this segment is mostly direct FITs, or book though OTAs and there is a strong MICE element given a close proximity to Greater Bangkok.

Flipping over to foreign demand in macro terms, this can be split into two significant segments – European ‘snowbirds’ who winter holiday in Asia and Chinese tour groups. What is emerging though has been the impact of AirAsia direct flights between Hua Hin and Kuala Lumpur, Malaysia. In 2019 passenger arrivals tallied in at 44,613 and the airlift is creating a new profile for Hua Hin as a destination.

Looking at the current airport expansion, it’s split into two parts. First is a runway extension to accommodate larger intra-regional aircraft and additional apron space to accommodate more planes. Second, is the expansion of the airport terminal. This work is planned to take 24-36 months to complete.

Another key infrastructure project that that needs to be looked closely at is the high-speed rail system that is underway and addition of a double-track capacity will enhance access.

C9’s report also highlights five new hotels in the pipeline with 1,627 keys. Noteworthy is a growing long-stay segment that is pushing into the villa rental segment. By location and catchment of key demand generators wellness and retirement markets are poised to grow.

Click to read and download the full report.