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Thai Airways exit from air freight reflects trends in Asian air cargo

Analysis

You have to be in it to win it. That mantra of Asia's air freight industry is more apparent after Thai Airways' late Mar-2015 exit from the sector. Thai confronted many challenges and its exit of only two dedicated freight aircraft is small but underscores changes in Asian air cargo.

Thai only operated converted 747 freighters, which provided a quick fix during the last cargo boom but have inherent inefficiency, and peers are phasing the type out. Thai lacked the advantageous North Asia geography and hub power of Cathay Pacific and Korean Air. This is important for the North America market, which Asian freighters focus on with some lift from passenger bellies.

Thai's core long-haul passenger market is between Europe and Asia, but supplementing this with freighters is difficult as Gulf carriers are strong competitors. Gulf carrier flights to Asia have increased from 28 a day in 2010 to 52 in 2015, compared to Western Europe-Southeast Asia flights increasing only from 57 a day to 61.

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