Thaworn to push THAI’s aircraft purchase plan

He said that following discussions with the Office of the National Economic and Social Development Council, THAI would need to buy more aircraft to raise its competitiveness with rival airlines in spite of its current losses. "This is because passengers today tend to prefer flying in new aircraft for comfort and value-for-money reasons. If THAI cannot compete in providing such service, the airline will suffer more losses," he said.
Regarding the source of investment capital for the purchase of new aircraft, Thaworn said raising the registered capital should be most appropriate as it will not impact the country’s financial status. Seeking loans is seen as difficult as THAI has been making losses.
Regarding the five units of retired aircraft A340-500 and A340-600, which are parked and ready for sale, he suggested that THAI should fly such aircraft on European routes instead, as it will create more value for the airline.
Thaworn said that he also wants THAI to speed up generation of revenue, especially from the sale of tickets through agents.
“I have ordered THAI to reorganise its ticket sales through all agents, who account for 75 per cent of all ticket sales but are not quite efficient. Some agents buy tickets in bulk but later return the unsold tickets to the airline.
“Due to this lack of efficiency, THAI is burdened with this expense and a lost opportunity to find more revenue,” said Thaworn.
Thaworn said that THAI has to adjust its rules with new agents, such as giving them the exact timeframe for selling the tickets. Agents who cannot sell tickets as targeted should be punished with a fine or blacklisting, or losing their right to be agents. The airline also should find other potential channels to increase ticket sales, such as through online ticketing and application, as these channels account for only 25 per cent of total ticket sales.
Thaworn said that he also wants Thai Smile Airways to revise and clarify its positioning in the market.
“In my personal view, Thai Smile should reposition itself as a low-cost airline, from the current ‘light premium’, which is in the middle between premium and low-cost airlines. From my own analysis, the number of seats Thai Smile offers is not different from that of low-cost airlines, but its tickets are priced higher. So it cannot compete with low-cost airlines,” Thaworn said.
“Thai Smile should adjust its positioning as a ‘low-cost’ carrier and reduce some services to make the tickets cheaper. Most low-cost airlines will also fly short-distance routes and require fewer services,” he added.