Travel agencies in Shanghai announced price increases on tours to Thailand starting from next week.
This is in response to increases imposed by their partners in Thailand after the Thai government's restriction on tourist shopping points, today's Oriental Morning Post reported.
The price rise amounts to 400 yuan (US$49) on tours offered by Shanghai Jinjiang International Travel Co Ltd, Shanghai Spring International Travel Service and China Travel International Ltd.
Shanghai's travel agencies said they received notice yesterday from their Thai partners to the effect that they had to raise prices as the Thai government, in a campaign to better-regulate the tourism sector, had reduced the number of shopping centers qualified for visits from overseas tourists.
The official move hits the local agencies' profits, since a large portion of their revenue comes from commission reverted by the shopping centers.
Shanghai industry insiders were not surprised at the increases.
"In fact, this is a return to normal prices rather than a price rise," said Li Feimin, with Spring International.
Claiming that "the current price of Thailand-bound tours, mostly between 2,000 and 3,000 yuan, is abnormally low," he estimated the market price should be around 3,500 yuan.
When offering extremely low prices, tour agencies have to cram shopping-time into the tour schedule to raise income, a practice which inevitably results in poor service and complaints from tour-members, he pointed out.
(Shanghai Daily August 12, 2005)