Thai Airways reportedly plans to launch a low-cost carrier in partnership with Nok Air by mid-2013, according to The Nation. The airline will focus on the regional market. Thai Airways acting president Chokchai Panyayong said Nok Air hired a consultant to conduct a feasibility study for the proposed carrier, with findings to be finalised by the end of Jul-2012. The airline would be created as a JV between Thai Airways and Nok Air with a registered capital of THB200 million (USD6.35 million). Thai Airways would be the majority shareholder. The branding of the carrier will not include ‘Thai’ in order to provide it a more international image, according to Mr Chokchai. The airline will assist Thai Airways to strengthen its market position ahead of Asean open skies in 2015.
Thai Airways to launch LCC by mid-2013: report
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Thai Airways regional connectivity Pt 2: Thai Smile international expansion is a strategic necessity
Thai Airways' regional full service subsidiary Thai Smile is expected to accelerate international expansion over the next year as Thai Airways transitions to an all-widebody fleet. Adjustments in the group’s dual brand strategy are also possible as Thai Airways and Thai Smile could benefit from much closer integration.
Thai Smile currently only operates four international routes and allocates 90% of its seat capacity to the domestic market. However, the airline is poised to take over Thai Airways’ four remaining international narrowbody routes and should be used to expand the group’s presence in secondary cities in China, India and ASEAN.
This is the second part of a report on the Thai Airways Group's regional international network and strategy. The first part looked at how the group has fallen behind its rivals in Southeast Asia – particularly the Singapore Airlines Group – in improving regional connectivity. In this second part CAPA focuses on the strategy for Thai Smile and how the Thai Airways group could finally start to use Thai Smile to bolster regional connectivity.
Thai Airways falls behind Singapore Airlines Group with regional connectivity: Part 1
Thai Airways will enter a new phase over the next year as it completes its transformation plan and starts to consider potential options for resuming expansion. Regional international growth is the most logical area to focus on, using the group’s full service short haul subsidiary Thai Smile.
Thai Smile currently only serves four international destinations. As Thai Airways mainline transitions to an all-widebody fleet the group will need a much larger international network from Thai Smile.
Thai Airways should also examine better integration of Thai Smile, following the model used by Singapore Airlines (SIA) with its full service regional subsidiary SilkAir. The current setup, including separate reservation systems and sales teams, is far from ideal and must be improved in order for the Thai Airways Group to close the gap with the SIA Group in key markets such as China, India and ASEAN.