New entrants not a deterrent: Bangkok Airways

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With at least two new low-cost carriers set to enter the Thai market within the next year, boutique carrier Bangkok Airways says it will remain focused on leveraging its codeshare partnerships to stay above the competition.

“When any new carrier comes in, it will have a new marketing strategy, new approaches, new offerings. We will have to see how the market reacts and have to be dynamic enough to adapt,” its president Puttipong Prasarttong said in a recent interview with Flightglobal Pro.

He gave an example of how the airline immediately lost half of the traffic on its Bangkok-Phnom Penh route when Thai AirAsia started serving the same route. Load factors however returned to their original level around five months later, when passengers realised the benefits of flying with a full-service carrier, he adds.

Its president of network management Peter Wiesner adds that Thai Lion Air will not compete directly with Bangkok Airways since it will be offering a low-cost product out of Don Mueang airport. Low-cost carrier Vietjet Air is another carrier that has announced plans to start a joint venture carrier in Thailand.

“We’re a full service carrier, we have lounges, meals on board, 20kg baggage, smooth check-in and interline, and that all happens at Suvarnabhumi. We cater to a different clientele. Thai Lion will compete more with AirAsia and Nok Air to a certain extent,” he says. “It will however be tough for them because they are not known in Thailand.”

He adds that Bangkok Airways, which carried 3.6 million passengers last year, is "on track" to reach its 4.15 million target this year. The carrier also aims to add another four codeshare partners to its list of 12 by mid-2014. The carriers are "sizeable players", says Prasarttong, but he did not elaborate further.

He adds that a large part of Bangkok Airways' strategy remains on matching its flight schedule with codeshare partners, so as to bring traffic from its partners onward to destinations within Thailand or the region, and to allow its passengers to connect on to services by its partner carriers "seamlessly".

Prasarttong says Bangkok Airways will need at least three more Airbus A320 family aircraft next year, and that it is also looking at new turboprops and new generation narrowbodies. Funds for its fleet plan could come from its planned, but delayed, upcoming initial public offering where it had earlier said it intends to raise baht (Bt) 10 billion ($311 million).

When asked about the status of the IPO, Prasarttong would only say it is “still ongoing”.