THAI drops low-cost carrier plan
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Thai Airways International's board of directors has decided very recently to not proceed with the proposed ultra low-cost carrier and will let its 49-per cent-owned Nok Air to launch international services next year, according to CAPA.
The centre of aviation news reported that the decision follows a study that was conducted over the last few months that examined the feasibility of expanding into the international market and potential routes. At the same time Nok and Thai Airways conducted a separate study that looked at a potential joint venture ultra low-cost carrier for the regional international market.
Nok Air CEO Patee Sarasin was quoted as saying that while Nok Air has decided to proceed with the Nok-branded project and that the Thai Airways board decided very recently to not proceed with the proposed ultra low-cost carrier.
Thai Airways originally unveiled plans in 2010 to launch a joint venture ultra low-cost carrier for the regional international market with Singapore-based Tiger Airways. But plans to launch Thai Tiger were dropped in 2011 after repeated delays in securing approvals to establish the new company.
After the Thai Tiger project fell through, THAI did not adjust its medium-term strategy, which continued to envision a four-brand matrix with a new ultra low-cost carrier for the regional international market. THAI executives as recently as Mar-2012 told CAPA that the group believed it still needed a new brand with a lower cost structure than Thai Smile and Nok. At the time it was open to exploring joint ventures with other foreign LCC groups to fill this void in its brand matrix.
In recent months, THAI also started to look at establishing a joint venture ultra low-cost carrier with its partially owned subsidiary Nok.
Patee said that the board now decided to take the planned fourth ultra low-cost brand “out of the matrix”.
THAI, which is currently looking for a new president following the departure of Piyasvasti Amranand in Jun-2012, “is trying to focus more on their own products,” Patee explained. That leaves Nok Air on its own to fill the THAI's gap in the budget end of the regional international market.
