The eight-day Spring Festival holiday and a series of favorable visa-free policies have boosted outbound tourism from Malaysia and Thailand. However, the overseas car rental market in these two destinations has not seen the expected "increase in both price and volume". A reporter from Beijing Business Daily found that compared with the 2023 Spring Festival holiday, the overall car rental price dropped by 7% in Thailand and 15% in Malaysia.

  The price reduction during the Spring Festival will be affected by the "price war" between Malaysia and Thailand car rental suppliers in 2023. In 2023, the recovery of car rental and self-driving tours in Malaysia and Thailand was lower than the expectations of suppliers. The oversupply caused suppliers to take turns to cut prices and promote sales. In 2024, as car rental suppliers become more cautious in their layout, the overseas car rental supply chain in Malaysia and Thailand is expected to be further repaired.

  Order volume rises, prices fall

  For the employees of Yesaway International Car Rental Thailand store, there will be more Chinese tourists after February 2024. Their business hours are from 7 a.m. to 12 midnight, and they do not distinguish between working days and rest days. Bowie, the operations director of Yesaway, told a Beijing Business Daily reporter that store front-line employees work in shifts. Despite this, the workload of dozens or hundreds of orders a day also makes it inevitable for employees to work overtime.

  The busyness of the clerks reflects the boom of Thailand’s car rental market during the Spring Festival. After the release of a series of visa-free policies, Southeast Asia, represented by Malaysia and Thailand, has received another wave of attention.

  Data from Car Rental shows that international orders during the Spring Festival increased by 365% year-on-year in 2023, which has overall exceeded the peak of the Mid-Autumn Festival and National Day in 2023 and reached a new high. Popular destinations are mainly Thailand, Malaysia, New Zealand, Australia, Norway, Italy, the United Arab Emirates, Spain, UK and other countries.

  Not only does Malaysia and Thailand rank among the top ten popular destinations, the number of orders has also grown significantly. According to car rental data, during the Spring Festival, Thailand's order volume will increase by more than 330% year-on-year and 310% month-on-month; Malaysia will increase by more than 780% year-on-year and 423% month-on-month.

  Bowie has also witnessed the popularity of Southeast Asia during the 2024 Spring Festival. He told a reporter from Beijing Business Daily that starting from the end of January and early February, the number of Chinese tourists in the store increased significantly. As far as the Thai market is concerned, affected by Western holidays, there will be more tourists from Europe, America, Japan and South Korea in December 2023 and January 2024. However, starting from February 2024, Chinese tourism to Thailand will enter the peak season, and yesaway’s Thai business will have more Chinese tourists The proportion reaches 40%, and the remaining tourists are mostly from Russia.

  Although visa-free has brought a lot of attention to Southeast Asia, contrary to the imagined "price and volume rise", the surge in order volume has not completely driven up the price of car rental. Bowie revealed that compared with the Spring Festival in 2023, the price of car rental in Thailand is Reduced somewhat.

  Car rental data also confirms this statement: During the 2024 Spring Festival, car rental prices in Thailand, Malaysia, the United Arab Emirates and other countries have dropped to varying degrees compared with the 2023 Spring Festival. Among them, Malaysia had the largest decline, reaching 15%; Thailand's decline reached 7%.

  The market fell short of expectations

  The price reduction in the car rental market during the Spring Festival is closely related to the development of the car rental market since 2023 and the decisions of car rental suppliers.

  In Bowie's view, the recovery of the car rental market in 2023 will be a slow process. Although the overall trend has been improving, it is still far from the expectations of suppliers.

  Take Thailand's car rental market as an example. According to Bowie's recollection, after the outbreak of the epidemic in 2020, the Thai car rental market, which used to have distinct off-peak and peak seasons, became chaotic. Tourists' travel has become uncertain, and the regularity of the market has been broken. In order to reduce costs, many car rental operators have reduced the size of their fleets. This has resulted in a sudden shortage of car resources during the peak season. However, after the peak season, the market quickly fell into a trough, and fleet resources were hoarded again.

  With the return of Chinese tourists in 2023, car rental suppliers, which have been suppressed for two or three years, have re-placed their expectations on Chinese tourists, making optimistic expectations and formulating corresponding plans.

  Initially, Southeast Asia was indeed the fastest to start recovering among China’s outbound tourism markets. After seeing the momentum, many suppliers expanded their fleet inventories in preparation for the upcoming May Day holiday and summer vacation.

  But soon, Bowie and other suppliers discovered that due to many factors such as flight resumption and travel safety, the resumption of Chinese tourists' travel to Southeast Asia was not as smooth as imagined. After the summer vacation, the car rental market in Southeast Asia, led by Thailand, failed to withstand the heat of the summer vacation and its growth slowed down. When supply far exceeds demand, suppliers start a "price war" in order to recover costs as much as possible.

  Bowie explained that the price war among car rental suppliers is not a long-term strategy, but a short-term strategy made by different suppliers based on inventory conditions. "For example, Supplier A has too much inventory this week and needs to digest it quickly, so it offers an extremely low price this week; and Supplier B has a backlog of inventory the next week, then Supplier B will lower its price," Bowie said. This situation not only happens to Chinese tourists, but also to tourists from all over the world.

  The “price war” is most intense from September to November. Bowie said that in the past, the lowest price in Thailand's car rental market would appear in May or June, but the lowest price in 2023 will be between September and November.

  From Bowie's perspective, behind the fluctuating prices are car rental providers' expectations for the return of Chinese tourists, and also their disappointment after adequate preparations failed. To the satisfaction of suppliers, prices rebounded in December. With the arrival of European and American tourists during Christmas and Chinese tourists during the Spring Festival, demand gradually increased. The current price in the Thai car rental market during the Spring Festival has been significantly higher than that between September and November.

  Car rental providers are more cautious after the holidays

  However, if compared with the 2019 Spring Festival, the price of the 2024 Spring Festival in Malaysia and Thailand will be higher.

  Chen Ailin, a car rental user who just returned from a self-driving trip to Thailand, said that in 2019, the cost of renting a car in Thailand was 130-150 yuan/day, but this time it was almost 175 yuan/day. “For me, compared with other countries where prices have increased, it is better to go there.” The cost-effectiveness of self-driving in Thailand is still very high.”

  Zhang Xiaolong, head of the car rental market, analyzed that due to various factors such as procurement costs, labor costs, inflation and other factors of overseas car dealers, car prices have remained in a high range after the epidemic. As outbound travel further recovers, today's price cuts also reflect the recovery of car dealers' supply capabilities and are a market correction to a normal price range.

  Gu Huimin, a professor at the School of Tourism Science at Beijing International Studies University, said that the performance of the Malaysia-Thailand car rental market is similar to that of China’s outbound tourism market in Southeast Asia, and the recovery of both in 2023 has not met expectations. However, the gradually rising prices also indicate that the supply chain of the car rental market in Malaysia and Thailand will enter a relatively stable recovery stage.

  When asked whether there will be a "price war" in the off-season after the Spring Festival, Bowie said that it has not happened yet. After experiencing exceeding expectations, disappointments and twists and turns in 2023, suppliers will no longer be too optimistic. forecasts should become more cautious.

  Gu Huimin believes that after the concentrated outbreak of travel demand in 2023, Chinese tourists are returning to rationality, and the quality of travel products is becoming one of the main factors affecting their decision-making. Therefore, car rental platforms and car rental suppliers should improve their products in addition to launching marketing activities. and service quality.

  Zhang Xiaolong said that China’s car rental in Malaysia and Thailand has broad prospects. As a global self-driving travel platform, Car Rental has held separate marketing campaigns for Thailand and Malaysia for the self-driving market, especially in the popular tourist cities of Bangkok, Phuket, Kuala Lumpur and Langkawi in the two countries. The current daily car cost has been as low as About 160 yuan. Car Rental has also cooperated with Alipay and the Tourism Bureau of Thailand and Malaysia to launch corresponding self-driving maps to provide detailed official self-driving guides for self-driving travel enthusiasts.

  Bowie also revealed the development strategy of yesaway International Car Rental: it will continue to "play steadily" in 2024. On the one hand, it will continue to replenish its fleet and introduce 10%-20% of new cars based on actual market feedback; on the other hand, it will strengthen cooperation with car rental platforms, continue to polish exclusive services for Chinese tourists, and attract Chinese tourists with better services .

  Beijing Business Daily reporter Guan Zichen and Niu Qingyan