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THAI cuts flight frequencies amid passenger slump

Oct 02. 2014
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Thai Airways International lowered its available seat kilometres (ASK), a measure of passenger-carrying capacity, in August because of declining numbers of passengers at Suvarnabhumi Airport, while its cabin factor dropped by 2.5 percentage points compare
At a board meeting on Monday, THAI’s management acknowledged the company’s operating performance for August. It was noted that Airports of Thailand’s statistics showed that while inbound and outbound international air traffic through Suvarnabhumi improved by 15 per cent in August from a month earlier, it was still 13.3 percent lower than in August 2013. 
As a result, THAI adjusted its flight frequencies to reflect actual travel demand, thus lowering ASK by 3.6 per cent compared with August last year. The same adjustment was applied to its subsidiary THAI Smile Airways.
The revenue passenger kilometre (RPK) rate for both airlines was 6.9 per cent lower year on year. On intercontinental routes, RPK was 8.3 per cent lower and on Asian routes it was down by 5.7 per cent. RPK on domestic routes, including those operated by THAI Smile, was 5.1 per cent lower than in August 2013. 
Cabin factor for both airlines averaged 75.3 per cent, which was lower than last year’s 78.0 per cent. 
For cargo and commercial mail, ADTK (available dead load tonne-kilometres), including passenger-aircraft bellies and freighters, was 2.2 per cent lower than the same month last year. Revenue per freight tonne-kilometre (FTK) was 15.7 per cent lower, which resulted in a freight load factor averaging 39.3 per cent, lower than last year’s average of 45.6 per cent.
IATA data 
In contrast, the International Air Transport Association (IATA) announced that August data for global air-freight markets showed continued robust growth in volume terms. Measured by FTKs, volumes rose 5.1 per cent compared with August 2013. Capacity grew at a slower pace of 3.4 per cent from the previous year. This is the second strong month for cargo volumes in a row, following the 6.1-per-cent year-on-year rise recorded in July. Carriers in all regions reported an expansion in volumes. Closely following improvements in world trade and business activity, airlines in the Middle East, North America and Asia reported the strongest growth in the 5-8 per cent range. By comparison, demand in Latin America and Europe lagged in the range of 1-1.5 per cent as a result of Brazilian economic weakness and European Union sanctions on business with Russia.
“The outlook for air cargo is clearly getting better,” said Tony Tyler, IATA’s director-general and chief executive officer. 
“However, there are some limiting factors on the extent of potential gains. Demand for air cargo is growing more slowly than global economic activity. Businesses are reported to have more confidence in the future, but the list of political and economic risks continues to moderate how that confidence translates into actual activity.” 
Air-cargo rates for Asia-Pacific carriers grew by 6.3 per cent, continuing the acceleration of recent months. Emerging-Asia trade expanded volumes solidly in June and July. A notable rise in Chinese export orders bodes well for future demand growth, IATA said. Capacity expanded 4.4 per cent.
THAI’s board of directors also approved 10 new management appointments, including in investor relations, technical support, safety, audit, and finance. The appointments were effective on October 1. 
The airline also announced THAI Smile’s operational plans for both Don Mueang and Suvarnabhumi airports for the 2014-15 winter traffic schedule, which starts on October 26.

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