Malaysia Hotels Turning to Domestic Travellers

Accommodation, Malaysia, coronavirus, Airbnb

Kuala Lumpur is a popular city for airbnb

In a conversation with Malaysian newspaper the Star, executives from the Malaysian Association of Hotels (MAH) indicate to help its members surviving the current tourism coronavirus crisis by targeting local travellers. 

As foreign travellers shun out Malaysia and generally all of Asia, the Malaysian Association of Hotels want to fill the void left by foreign travellers with local ones, explained to StarBizWeek MAH vice-president Michael Quay.

In an interview with the Malaysian newspaper, Quay keeps positive about the current crisis that tourism in Malaysia is facing.

“We spoke to airline companies and learnt that there have been plenty of cancellations to outbound flights. So this should be considered a valuable opportunity to promote and increase travel within the country,’ he explained the publication. However the government should find a way to promote tourism and travel within the country, he believed.

MAH Hotels Training and Education Centre chief executive officer Yap Lip Seng says the Malaysian hotel sector has been hit hard by the Covid-19 epidemic, with estimated losses totalling US$15.95 million (RM66.82mil.) within less than two months of this year.

Since the outbreak, he says the association had recorded a total of 157,525 room cancellations from hotels nationwide as at Feb 17.

“Surprisingly, for the month of January, many hotels reported extremely positive numbers, until the 25th when the Chinese government announced they were going to block their own citizens from booking hotels and tours. Up to then, most hotels reported positive growth for most of January but then the Covid-19 hit us all badly.”

According to Yap, hotels in Kuala Lumpur were the worst hit with US$5.3 million (RM22.17mil) in losses, followed by operators in Sabah at US$2.76 million. Penang was the third-highest, recording losses totalling US$2.1 million.

According to statistics, travellers from China consistently make the top 10 list of international tourist arrivals in Malaysia. In the first half of last year, the country recorded 1,558,782 tourist arrivals from China; the Chinese accounts for 11% of Malaysia’s total tourism market. Yap explained to StarBizWeek Malaysia is targeting 3.48 million Chinese tourists for Visit Malaysia Year 2020.

Blaming Airbnb

On top of the Covid-19 outbreak, Yap says the local hotel industry is also facing stiff competition from Airbnb operators.

“Last year, Airbnb announced between 53,000 and 54,000 listings in Malaysia. In Kuala Lumpur alone, there are between 17,000 and 18,000 and they claimed to have generated RM3 billion for the country. But it goes to the homeowners. They use it to pay their loans; it doesn’t come back to the tourism industry at all. This is the same chunk of money taken from the people working in a hotel. If they didn’t stay in an Airbnb, there would be a 6% service tax imposed and that will go to the government. It is a leakage from the system and it’s not healthy for the industry.”

Yap says because the Airbnb segment is not regulated, its operators are not well prepared to deal with the Covid-19 outbreak. “Unlike hotels, Airbnb operators don’t have the standard operating procedures in place to deal with something like an epidemic.”

He added to the Star that hotel operators, on the other hand, are better prepared to deal with such a situation.

“Hotels must all comply with the Registration of Guest Act, where we must register guests that stay on the premises so we know exactly where they’re from and when the authorities request for it, we have to provide that information. For Airbnb operators, they don’t have that, so if you want to trace somebody from Wuhan that stayed here, you won’t be able to trace where he or she was. So you cannot contain the spread in that sense.”

(Source: The Star)