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Beating Nokscoot out of the gate could be important, but AirAsia should be prepared to wait for success since Thailand’s political situation has yet to show any signs of improving.
Thai AirAsia X, Thailand’s first long-haul low-cost airline, will take to the skies about two months from now despite the tourism market being dragged down by the country’s political turmoil.
After putting off the launch previously planned for the first quarter, Thai AirAsia X will launch its maiden service from Bangkok to Incheon, South Korea on June 17 and then kick off regular flights to Japan’s Narita airport in Tokyo and Osaka around July.
While acknowledging the major fallout of Thailand’s political unrest on traffic demand both inbound and outbound, Thai AirAsia X chief executive Nadda Buranasiri yesterday said the launch was fixed because the airline is ready to do so.
Being the first entrant in the medium-to-long-haul air travel market in the country, it sees the strategic opportunity of being registered in consumers’ minds.
“Being the first, people tend to remember and associate us as the country’s first long-haul low-cost operating in and out of Thailand, making us their choice,” he said.
It also wants to pre-empt NokScoot, a joint venture between Thai budget carrier Nok Air and Singapore’s Scoot, which is expected to start up in the last quarter of this year as the country’s second player in the same segment.
Thai AirAsia X’s launch is seen as opening up a new travel segment between Thailand and South Korea along with Japan and intensifying competition over the skies crowded with international carriers, both budget and full-service airlines including loss-making Thai Airways International.
The scale of Thai AirAsia X’s launch and business plan this year seem to be subdued by the poor travel market outlook, which is entirely attributed to the chaotic domestic politics, as the airline goes for a more conservative approach in raising its profile.
Thai AirAsia X currently only sets its sights on having two Airbus A330-300 wide-body jets operating this year and next, limiting its coverage to the three destinations in South Korea and Japan this year.
Thailand’s political situation is the most crucial factor charting Thai AirAsia X’s growth plan, according to Tassapon Bijleveld, a major stakeholder and chief executive of Thai AirAsia, the country’s largest low-cost carrier operating on short-haul routes.
Mr Nadda, formerly a music industry executive, sees Thai AirAsia X’s brand association with AirAsia, Asia’s largest budget airline group, will help ride out fierce competition along with its low-fare offering which is generally about 15-20% below what is charged in economy-class by full service airlines.
Thai AirAsia X now leases an A330-300, with 377 seats, which has been operating chartered flights between Don Mueang Airport and Narita airport since April 1.
The second A330-300 is due to be delivered early next month, providing the needed capacity to allow it to launch the Japan services, said Mr Tassapon.
The two aircraft will be fully utilised by Thai AirAsia X, which will stop the charter service to Narita just before the maiden flight to Incheon.
Thai AirAsia X will offer a daily service from Don Mueang to Incheon and Narita, while the frequencies to Kansai airport in Osaka will be five flights a week.