Thailand’s hotel sector is experiencing pricing pressure this year after four consecutive years of rate increases that have nearly doubled average room rates since 2021, as tourist numbers from China and other major Asian markets have dropped significantly.
In its latest Industry Spotlight report, Tris Rating projects total foreign tourist arrivals of 33.1 million this year, a decrease of 5.6% from 35.5 million in 2024. The forecast reflects a slowdown from several traditionally strong Asian markets including China, Malaysia and South Korea, which typically represent Thailand’s tourist base.
Foreign arrivals for the first eight months of this year were down by 7.2% from a year earlier to 21.9 million, the Ministry of Tourism and Sports said on Tuesday.
However there has been an increase in Indian arrivals. India now ranks among Thailand’s top five source markets.
Long-haul markets have also performed well, with US arrivals rising 7.4% year-on-year and European visitors surging 15.6% so far.
For hotels, occupancy rates reached a post-pandemic high in 2024, exceeding pre-pandemic levels.
However, this is not expected to continue in 2025.
Hotel operators are choosing to lower room rates. As a result, Tris expects the overall occupancy rate to remain flat or slightly decline this year.
