Japanese tourists begin returning in increasing numbers

Japanese tourists have started to come back to Thailand again after their country was hit by a financial crisis which caused major yen turbulence. Japanese are visiting Thailand in a significantly increasing number, though fewer have left their country since the crisis started to bite Japan’s economy last year, said tourism minister Mr. Pitak Intaravittayanan.

The minister said the Japanese have joined Europeans and Chinese traveling to Thailand in the first quarter this year. Not only Japanese men, but Japanese women, teens and the elderly have come in increasing numbers; the phenomena has been regarded as an indicator that the Kingdom is still the most favorite Asian destination of Japanese travelers, said the minister.

About 1.2 million Japanese tourists are expected to visit Thailand through the end of 1999. Europeans keep coming in despite the traditional low season.

The Thai Hotel Association said numbers of visitors to Phuket and Samui have increased by 7% in the first quarter, while those to Bangkok and the central provinces rose only 2%.

Fewer foreign tourists have visited the more remote northeastern provinces despite richness in cultural and historical sites in then region.

Companies rush for department’s Baht 30-billion construction projects

About 100 contractors, both local and international, have rushed to join bids for 3 major construction projects under the Department of Public Works this year. More than 70 contractors have already bought PQ forms for the bridge and road construction projects to connect the city of Nonthaburi and Petchkasem Road on the Thonburi side, said department sources.

It would be one of the hottest races for projects and is badly needed by contractors in the economic crisis. The application for bids to construct Wat Nakorn-in bridge and a road system, with more than Baht 10 billion in combined construction costs, was be opened to contractors May 19. Only 4 companies would be chosen by the department to implement the road and bridge construction projects after years of political squabbles.

There is another bridge construction project across the Chaophraya at Poo Chao Sming-Prai Road in Samrong District, together with a road system to connect Samut Prakarn’s Prapadaeng district to Rama 3 Road to the south.

Sumitomo Group and Daewoo Construction are two of the foreign construction giants making bids. Meanwhile, Italy’s Rizzani de Eccher SPA made its first bid for major projects in Thailand.

Hotels declare 1998 an amazing year in earnings

Major hotels have reported high incomes for 1998. Only 3 said they were running in the red, but as a result of foreign exchange. Beach-side hotels and resorts, especially those in Phuket and Samui, have had their best performance ever in 1998, with occupancy rates between 80-90%, and with no traditional low-season through the whole year.

Bangkok’s five-star hotels have all had another best year ever, with reported occupancy rates of between 70-85%. The riverside Shangri-La said it had done far better in 1998 than in 1997, with an occupancy rate of 70%. But the chain has run at a loss due to investment projects in Myanmar. The Oriental has reported to the Stock Exchange of Thailand a Baht 336.30 million net profit for 1998, the highest in several years.

The Pacific Asset group, which operates the Le Meridien chain, also had one of its best years in term of earnings in 1998.

The depreciating baht last year also contributed to higher incomes of hotels. The Oriental said it rented rooms in US dollars after the Baht flotation in July 1997, but at much lower rates - from US$300 to US$200.

Seaside hotels in Pattaya and Cha-Am also reported increased earnings; but Asia Hotels Co was the third to report losses due to foreign exchange.

To Boots, Thai crisis has created opportunity to grow

Boots Retail (Thailand) will continue to expand this year despite the economic crisis, with 7 more branches to be opened. The plan is to have up to 100 Boots stores nationwide in the next 3-5 years. Boots said it was reluctant the first time it entered the Thai market, feeling that there were only two choices - stop the investment during the crisis or go ahead with the plan. The company chose the latter, said Lord Blight of Rowington, Boots chairman in Thailand.

"We’ve proven we could do it. Sales have increased in every Boots store," Lord Blight was quoted as saying in an interview. "Boots will soon have three new branches - on the 7th floor of Maboonkrong Shopping Center, on Sukhapibal 3 Center and on Khao Sarn Road," he said. "Boots now has 37 branches and is on its own in expanding," said Lord Blight.

About one-half of goods in the specialty store are locally made. The portion should be higher in years to come as pharmaceutical products are scheduled to be manufactured in Thailand next year.

Boots last week introduced Neurofen, the best selling anti-pain tablet in England, to the Thai market. The company will open the first Boots store in Tokyo in July, and Japan would be the second country for Boots in Asia.

AIS files damage suit against TAC over advertisement

Advance Info Service Plc has filed a lawsuit against Total Access Communication Plc asking Baht 615 million in damages caused by TAC’s advertisement against AIS’ Digital GSM cellular phone service. AIS told the Bangkok Civil Court that sales of its products had sharply decreased since TAC started printing ads, TV and radio commercials against its Digital GSM cellular network in January, alleging that higher wattage in transmission causes a higher risk to the user’s brain. AIS uses its 2-watt transmitting power as a selling point, by convincing users that higher wattage means clearer reception.

Though a real danger to health is yet to be proven, TAC claims that there was a clear risk from transmitting in higher power, while its Digital WorldPhone 18000 MHz service, GSM’s rival, was transmitted in a lower range of power, between 1 to 1.2 watts. AIS said in a counter campaign that the GSM system has been proven safe in Europe and many other countries. But TAC, branding AIS as a ‘hooligan’, hit back that it was safe to the fact that it was not transmitted in high power, up to 2 watts, as was done by AIS in Thailand.

TAC said it would go on with the campaign despite the law suit. AIS claims it has spent more than Baht 251.7 million in creating service acceptance from the public. Competition will heat up again as AIS said it will start a new price campaign this month, aiming to double sales of GSM handsets to 40,000, from a normal rate of 20,000 sets a month.

Honda cars reshuffle to cope with marketing changes

Honda cars has undergone a restructuring in its Thailand operations in accordance with changes in the Japanese parent company, Honda Motors Co. Top executives in the Thai manufacturing and marketing units have been changed in a reshuffle to be effective this June 1, said Honda sources. The changes were made on April 27 by orders form Japan’s Honda Motors, they said.

Satoshi Toshida, who, from his Bangkok-based Honda Asian Co., used to oversee Honda Cars Thailand and Honda operations in the whole of Asia and Oceania, would be back to a new appointment in Japan’s Honda Motors. Replacing Toshida as HCT’s chairman is Kanji Kashiwaki, formerly Honda Motor’s planner for Asia, while Norikatsu Sato, a senior executive director of Honda Cars Manufacturing Thailand replaces Yuji Ichigawa as the company’s chairman. Ichigawa was appointed to managing director of a Honda company in Japan, said the sources.

It had been too tough a task for Toshida to oversee troubled markets in the vast Asian and Oceanian region. HCT probably will maintain Toshida’s key policies, which include a determination to best satisfy customers, and to introduce new products.

The minor-change model of Honda City budget car with VTEC engine, under Honda’s Low Emission Vehicle concept, would be launched on May 25.

Hotels, industries hope to net millions from UNCTAD meeting here

Thailand’s hotels and related industries could earn up to Baht 1 billion from the 2000 annual meeting of the United Nation Conference on Trade And Development here on February 9-19 next year. The Queen Sirikit National Convention Center alone could earn between Baht 600-700 million directly from hosting the meetings.

There expected to be 2,000-3,000 UN officials from 188 countries and about 7,000 others, which include followers, spouses and mass media members, joining the conference - considered to be the first major international event in the new millennium. There would be a number of summit meetings of leaders from 25 countries in the same period of time, said Mr. Kobsak Chutikul, Director General of the Economic Department of the Ministry of Foreign Affairs.

The conference would be even larger than the World Bank conference here about 10 years ago.

A national-level committee chaired by PM Chuan Leekpai was set up to see to the UNCTAD meetings.

It is also expected that the local tourism industry would get a big boost through full coverage by CNN and other major networks.

Oil dealers plan protests at US Embassy, House of Government

Esso oil dealers said thousands would join protests in front of the US Embassy here if Esso Thailand Plc fails to produce a clear reason as to why the company will not renew oil retailing contracts with them. About 2,000 representatives from Esso dealers, which own gas stations nationwide, would join the gathering, said industry sources.

Dealers would give Esso Thailand Plc until the end of May to give their answer, said the sources. It has been known within the company that retailing agreements with about 200 dealers would be revoked when they expire next June in order to cut costs. Esso Thailand Plc would maintain its own-operated service stations, they said.

Esso’s management was urged to produce a clear target as to how many stations would be closed and how many employees would be affected in the next redundancy process. Employees urge for a delay to layoff, rationalizing that they have nothing to do with the huge losses of the state oil company.

Copyright 1998 Pattaya Mail Publishing Co.Ltd.
370/7-8 Pattaya Second Road, Pattaya City, Chonburi 20260, Thailand 
Tel.66-38 411 240-1, 413 240-1, Fax:66-38 427 596; e-mail: [email protected]
Created by Andy Gombaz, assisted by Chinnaporn Sangwanlek.