Thai AirAsia, an associate carrier of Malaysian low-fare airline AirAsia, launches operations on 3 February and will initially compete on two domestic routes in Thailand with just one Boeing 737-300, although it expects to have eight aircraft by year-end.

The airline's main competitors will be Thai Airways International and Orient Thai Airlines' recently launched no-frills carrier One-Two-Go, which has its own ambitious expansion plans.

Kuala Lumpur-based AirAsia owns 49% of Thai AirAsia while Shin Corp, a Thai telecoms company founded by Thailand's prime minister Thaksin Shinawatra, controls 50%. Thai AirAsia's chief executive Tassapon Bijleveld has the remaining 1%.

Thai AirAsia will begin operations on 3 February with one 737-300 and operate on the Bangkok- Chiang Mai and Bangkok-Phuket routes. By the end of February it expects to have two 737-300s and also be operating from Bangkok to Hat Yai and Khon Kaen. Its aircraft will be subleased from AirAsia (Malaysia).

Thai AirAsia also plans to begin operating from Bangkok to Singapore at the end of March or early April, says Tassapon.

AirAsia (Malaysia) chief executive Tony Fernandes is liaising with the Singapore authorities on Thai AirAsia's behalf.

Fernandes is also negotiating to acquire nine 737-300s this year in addition to the eight aircraft to which the carrier is committed.

AirAsia has 13 aircraft, including the two earmarked for Thai AirAsia.

Fernandes says Thai AirAsia's expansion in Thailand depends on how soon he can secure the additional nine aircraft.

While Thai AirAsia is set to launch, one of its competitors has an expansion plan of its own.

Orient Thai's One-Two-Go has two Boeing 757-200s and operates on the Bangkok-Chiang Mai route. It hopes to lease four more 757-200s for delivery by the third quarter and have four Boeing MD-82s by year-end, with the first to be delivered around May.

In the meantime, One-Two-Go aims to launch services from Bangkok to Hat Yai and Chiang Rai in the first week of February. It will then look to launch services on the Bangkok-Phuket route once it acquires additional 757s.

Source: Flight International