28th Jul 2014
The state-owned flag carrier has proposed to move the base of operations of its lower-cost affiliate from Suvarnabhumi International Airport to the older Don Mueang International Airport.
The decision to transfer arose during the board meeting last week between airline officials led by acting THAI president Siwakiat Chayema and Prajin Juntong, deputy leader of the National Council for Peace and Order.
Airline officials were already instructed to submit detailed proposal to the board during its meeting on August 14. If it gets approved by the board, the airline can start moving to its new home.
It is believed that the transfer could somehow help the subsidiary to attract more customers and compete head on against its fellow budget carriers. Thai AirAsia, its major rival, has long established its hub at Don Mueang flying to most major domestic and regional destinations.
If the transfer would push through, Thai Smile will lose its advantage of having an easy connectivity with Thai Airways, whose passengers may have connecting flights to many local and regional destinations.
Suvarnabhumi Airport and Don Mueang Airport are 50 kilometers apart and travel time between airports doesn't seem to be attractive to travelers. Thus, Thai Airways badly needs Thai Smile at Suvarnabhumi to keep a seamless connectivity between them.
The Thai Airways is worried about the continued dominance of AirAsia at Don Mueang, as it has virtually eroded much of its share in the domestic market.
The departure of Thai Smile will definitely strengthen Bangkok Airways' foothold as the lone airline serving both the domestic and regional markets from Suvarnabhumi International Airport. Bangkok Airways will surely enjoy its role as the lone carrier with extensive domestic and regional routes, offering a viable business to its partners such as Etihad, British Airways, Qantas and Qatar.
According to the airline official, the airline needs to adjust its business strategy to grow its revenue, adding that most passengers on domestic routes prefer Don Mueang Airport over Suvarnabhumi, as it is more convenient being so close to the capital.
With its imminent transfer to Don Mueang, Thai Smile will be able to complement Nok Air's already extensive domestic route network. Both airlines just need to adjust their respective schedules to avoid unnecessary competition.