Competition to become Thailand's second 'flag' carrier appears to be thinning amid concerns that the regulatory framework favours Thai Airways on both domestic and international routes.

Fledgling Princess Airlines has emerged as the frontrunner to win government approval to join Thai as the country's second designated international carrier. Princess is owned by a consortium of local investors led by leading businessman Pow Sarasin and including General Sirindra Dhupklum, chairman of the Telephone Organisation of Thailand, with backing from the Thai Farmers Bank. Its case may have been further strengthened, as sources say that former Thai Airways president Chatrachai Bunya-Ananta has joined the consortium.

Bangkok Airways has pulled out of the race, citing vague conditions over traffic rights and doubts over the financial soundness of the operation. Bangkok Airways flies domestically but is not allowed to compete directly with Thai.

Bangkok's chairman, Dr Prasert Prasartthong-osoth, says the presence of Thai Airways board members in the official route allocation process would limit the carrier's operations.

A consortium involving Bangkok Bank and the Charoen Pokphand Group has also withdrawn from the race and another domestic airline, Orient Express, has indicated it will pull out.

Princess Airlines acting general manager, Dhera Vatshirapiyatanon, says the carrier has financial backing, though he will release no shareholding details or fleet plans. Bids were due to be lodged by 29 November with a final decision in January.

Tom Ballantyne

Source: Airline Business