Thai AirAsia, Thai Vietjet lead Thai domestic recovery; others suffer

Thailand's airlines have been severely hit by the COVID-19 pandemic, which has stopped the feed of tourists to one of Asia's most popular tourist markets. Two airlines - Thai Airways and Nok Air - are attempting to restructure through the bankruptcy courts. But as in some other countries in the region, a strong domestic rebound means some airlines are recovering better than others.

LCCs have increased their dominance of Thailand's domestic market. Generally, their demand climbed back to pre-COVID levels through 2020, and they were able to restore most domestic capacity.

Some, such as Thai Vietjet, have actually seized the opportunity to grow their presence in the domestic sector. Despite a recent dip related to a new COVID-19 wave, they should benefit from stronger internal demand through 2021.

In contrast, Thai Airways' international routes are mostly suspended due to the COVID-19 crisis. The flag carrier is haemorrhaging cash while the bulk of its widebody fleet is grounded, and it is negotiating a restructuring plan with its creditors and other stakeholders. Thai is reporting good progress in these efforts, and is expected to submit a plan soon to cut its costs and reposition itself for a changed international market.