Thai Airways unit Thai Smile seeks to prove itself as a new type of carrier for Asia

While Thai Airways' new unit Thai Smile is now settling in to its second week of operations, the carrier remains in the vanguard and is seeking to prove its hybrid model as suitable for the Asian market. Thai Smile has undergone many revisions since being established just over a year ago and continues to, with the carrier now planning to split future capacity evenly between the domestic and international markets rather than have a majority of international capacity.

Thai Smile launched services on 7-Jul-2012 with an international route to Macau but in Aug-2012 will launch domestic services. So far besides Macau only five domestic routes have been announced but more international routes will come as part of a later phase, including possibly from second-tier Thai cities, breaking Thai Airways' focus on Bangkok and, to a lesser extent, Phuket. But the new unit's higher cost base than a LCC will ultimately limit its growth potential.