Friday, October 15, 2010

Thai AirAsia to cool its jets in 2011

KUALA LUMPUR : After Thai AirAsia's (TAA) aggressive expansion this year, including receiving six new Airbus A320 jets, the company says it will slow its growth next year to strengthen its organisation and address resource weaknesses.

The no-frills unit of Malaysia's AirAsia plans to open fewer new routes and will add only two new planes in order to spend more time in areas such as improving overall service quality and enhancing employees' skills to support future growth more effectively, said TAA chief executive Tassapon Bijleveld.

Its 2011 plan calls for only five new routes, three domestic and two to India, and opening up Chiang Mai as its third air hub here after Bangkok and Phuket.

In January, TAA will start offering flights from Chiang Mai to Bangkok, Hat Yai and Singapore. The airline may step up frequencies from Bangkok to Macau and Singapore, he said.

Next year, TAA is keen to add Mumbai as part of its foray into India which will begin on Dec 1 this year with flights from Bangkok to Kolkata and New Delhi.

Much of TAA's effort will be to maintain its current network and frequencies, he said. TAA now operates 29 routes, 13 of them domestic, and more than 100 flights per day.

The two additional A320s next year will bring the fleet to 21.

But TAA will continue its high-paced marketing and promotional campaigns in 2011, with 30 campaigns throughout the year, the same level as this year, in order to drive revenue, passenger traffic and profitability.

Mr Tassapon said TAA expected passengers to hit 6.9 million next year, up from an expected 6.2 million this year.

The airline expects revenue of 12 billion baht this year with a net profit of 1.2 billion, a reversal from a loss of about 300 million in 2009 resulting from the default fees of the return of seven Boeing 737-300s to aircraft leasing companies a year earlier than expected as it sped up an aircraft replacement plan.

Mr Tassapon said the long-awaited plan to list TAA on the Stock Exchange of Thailand may become clearer in the second or third quarter of next year.

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