Two of Thailand's largest independent airlines are embarking on diverging expansion strategies in a bid to head off increasing no-frills competition on domestic routes.

Phuket Air is to double its Boeing 747 fleet by the end of the year to 12 aircraft as it launches an ambitious long-haul strategy, while Bangkok Airways is to start several medium-haul regional routes with its new Airbus A320 fleet. Several start-up airlines offering low fares on Thai domestic and short-haul routes have appeared in the past year, including Air Andaman, PB Air, Orient Thai and Thai Airways International subsidiary Nok Air, driving down yields, says Bangkok Airways vice-president Nandhika Varavarn.

Bangkok Airways is phasing out its remaining three ATR 72-200s and acquiring six ATR 72-500s for domestic services, while taking delivery later this year of its first two 163-seat A320s from an order of four. The Bangkok-based carrier is to start three-times weekly flights to Mal‚ in the Maldives from the fourth quarter, and is in talks with five Chinese airports to launch further A320 services from next year.

Meanwhile, rival Phuket Air is pinning its hopes on long-haul services, with plans to acquire five more 747-200/300s before January, in addition to the six in service and a seventh set to be delivered this month, says senior vice-chairman Kanin Phuvastien. The carrier added a three-times weekly service from Bangkok to London Gatwick this month and is launching services to Sydney in October.

Phuket Air also plans to launch services to Moscow Sheremetyevo before the end of the year, and has started services to Dubai via Chittagong, Bangladesh. The airline also has provisional approval to launch services to Kolkata, Mumbai and New Delhi in India, he adds.

Phuket Air retains four 737-200s and four NAMC YS-11 turboprops on its Thai routes, but Phuvastien says expansion in the domestic sector was dismissed because low-cost competition is lowering yields and the privately owned airline had enough capital to acquire widebody aircraft.

"London is the first step into Europe and paves the way for future expansion in this market, where there is still significant underserved demand," he says.



Source: Flight International