Thai AirAsia Missing Growth Target

18th Aug 2014

AirAsia Plane

The weakened demand during the first quarter of this year will certainly affect Thai AirAsia's growth target for this year.

The local subsidiary of the budget giant AirAsia Bhd. has put the blame on the political crisis that gripped the country for over 6 months, affecting the economy and most especially its tourism industry.

The airline has revised its fleet expansion as a result and will now take delivery of just five aircraft instead of eight. Consequently, its passenger target is also adjusted down from 13.3 to just 12.6 million for this year.

Based on the data available from the Tourism Authority of Thailand, the country's international visitors went down by 9.9% year-on-year to 11.8 million. During the height of the political crisis, 52 countries and territories barred their citizens to travel to Thailand.

Thai AirAsia took delivery of four A320s aircraft early this year and will soon take one more A320 before the end of this year to a total of 40 planes in its fleet. A320 is a family of medium-haul narrow-body aircraft that seats up to 180 passengers.

Tourism official disclosed that tourism industry in the country has seen signs of recovery already starting last July. He added that the country's tourism has been traditionally resilient and quickly recover only after a month or two.

The carrier needs to keep a load factor of 82% on average to grow its revenue.

It has just announced a route expansion with the addition of Sakon Nakhon to its network, linking it with Bangkok on October 1 this year.

Also on the network expansion plan are two more northeastern destinations, Buri Ram and Roi Et while a fourth frequency from Bangkok to Khon Kaen will commence next month.

This early, the budget carrier has already hinted that two more routes are in the pipeline, a domestic and a regional, to be launched before the year ends.

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