Feb 3, 2023
Thai AirAsia Adding Back Idled Jets Amid China Tourism Restart
(Bloomberg) -- Budget carrier Thai AirAsia Co. plans to resume operations of eight aircraft that were idled during the pandemic and is considering shifting planes from other parts of the group to cater for the growing number of visitors from China.
Asia Aviation Pcl, the operator of Thailand’s biggest low-cost airline, also expects improved earnings growth with the resumption of more flights to Chinese cities, Chief Executive Officer Santisuk Klongchaiya said during an interview in Bangkok on Thursday.
“Our advance bookings have demonstrated strong earnings momentum,” Santisuk said. “We may find a big challenge to expand seat capacity with demand from Chinese travelers. But seat shortages are a problem we’re happy to deal with.” Thai AirAsia currently has 53 jets in its fleet, he said.
The carrier joins peers including Thai Airways International Pcl in scrambling to right-size their fleets to cater for a jump in tourists from China, which now allows people to come and go freely without quarantine.
Read more: The World Just Doesn’t Have Enough Planes as Travel Roars Back
Thailand welcomed 11.2 million foreign tourists in 2022, the highest number since Covid emerged in early 2020, and expects seven to 10 million Chinese travelers to arrive by air this year, Health Minister Anutin Charnvirakul said last month.
Asia Aviation posted a record quarterly loss of 4.72 billion baht ($143 million) in the three months through June 30. Capital A Bhd.’s AirAsia Aviation Group owns 43% of Asia Aviation, according to the company’s website.
While Thailand’s tourism market is recovering, there’s still a long way to go. In 2019, the popular beach holiday destination welcomed 40 million international arrivals.
And Thai AirAsia is facing some slowdown in demand from travelers from India, whose government has reintroduced mandatory Covid tests for people coming from a number of Asian nations, including Thailand. The high cost of jet fuel will also weigh on Asia Aviation’s earnings, Santisuk said.
In February, Thai AirAsia plans to increase the number of flights to Chinese cities from two a week to seven, Santisuk said.
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