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  • Jim Selkin

Danang outbreak's chilling effect on a heating up domestic tourism recovery

Domestic travellers in Vietnam are reacting with an overabundance of caution and opting for holidays even nearer to home, but the industry is now holding out hope for Tet.

Text and photos copyright Jim Selkin - Aug 2020

Danang, the second largest city in Vietnam as seen from Monkey Mountain maintains a cool, urban vibe to go with its vast stretches of beaches.

Vietnam, among a handful of countries, served as a role model in dealing with the initial outbreak of the worldwide Covid-19 pandemic. With the government relaxing travel restrictions as pent-up demand increased in the country, domestic tourism was on a definite upswing – until recently.

The record of 100 days without a case was abruptly brought to end during the July outbreak in Danang. The government's swift steps to the contagion containment, including locking down Danang and halting all flights and transportation services in and out of the central coastal city, dealt a blow to a domestic tourism sector that was just picking its way up from the earlier lockdown.

Richard Burrage, Managing Director of research firm Cimigo in Ho Chi Minh City, said: “As the virus was initially successfully constrained, Vietnamese began to travel for summer breaks in July, leading travellers to hit the central beach resort and tourist mecca of Danang. That is until 27 July, when a small cluster developed leading to a city-wide lockdown and sent tourists scrambling to return home. It's a volatile time for the tourism industry here, having hopes of a domestic resurgence prematurely dashed.”

Sandor Leinward recte Rein, Managing Director of Exo Travel Vietnam, remarked: “As our retail offices were capitalizing on a sudden booming of business, 27 July put a full stop on that trend. Since not all initial cases were identified and people hastily exited to points around the country, locals reacted with an overabundance of caution and cancelled their plans. It was like March all over again.”

“It has been three weeks since the incident in Danang and while we do see some recovery, demand has not kept pace,” said Linh Le, Principal and Co-Founder of Luxperia. “From the booking data received after the first wave, it's likely to be three months for business to pick up more regularly.”

Quynh Nguyen, CEO of Allez Voyage in Hanoi, also voiced a cautionary note to potential travellers. “Bookings done through accredited agencies have cancellation clauses and can claim refunds if necessary. Those who book online, with cheap, non-refundable airfares, lose everything.”

Burrage also noted that the recent outbreak in Danang has altered domestic travel patterns, disrupting the earlier resurgence of travel across all age groups and demographics which were apparent until June 2020. "The outbreak in Danang has all but erased elder travellers, even within the family group dynamic," he observed. "Younger families, the largest segment of the local travel populace, are cutting back frequency and length of trips. And younger, more adventurous travellers are limiting their travel plans to within a day’s drive [of Saigon] in case of another sudden lockdown.”

Danang businesses such as the famous Bánh Xèo Bà Dưỡng restaurant, which is constantly jammed with locals and tourists alike, have been forced to temporarily close due to the Covid outbreak.

The tourism industry, and those who rely on it for their livelihood, have meanwhile been forced to look inward and evaluate their futures. Larger wholesalers and DMCs were especially affected, as their products were focused on overseas visitors and not on the domestic markets.

DMC heads, including John Tue Nguyen, Founder & CEO of Trails of Indochina, and Nick Wade, Managing Director of Khiri Travel Vietnam, both pointed to a refocus of their efforts on the expat and wealthier Vietnamese populace without radically changing their core business structure.

Smaller tour operators such as Saigon-based Luxperia and Hanoi-based Allez Voyage, who already catered to the international and domestic markets prior to Covid, were seemingly coping better as both had programs geared for domestic travel and were creating packages to appeal to both expat and local travellers.

All industry eyes are now on the Tet holiday, taking place 11-16 February 2021. As the largest, single travel period for Vietnam, and traditionally at the height of the favorable dry weather season, there is cautious optimism for a sustained recovery.



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