THAI shoots down second low-cost airline plan
THAI AIRWAYS announced yesterday it had scrapped plans for a new budget airline to handle domestic and regional flights, which was part of a strategy to fight competition from budget rivals.
The national flag carrier said another budget airline was unnecessary now the government has ordered all commercial flights to be based at the new international airport - Suvarnabhumi Airport - near Bangkok. The decision will cause budget airlines to shoulder higher costs as they move from the existing Don Muang international airport to the new airport, said THAI president Apinan Sumanaseni. "We had prepared everything for the official launch of our low-cost carrier, Euarng Luang. But now that the government has decided all flights will fly to the new airport, we have no reason to set up another unit," he added. Suvarnabhumi Airport, whose name means "golden land", is tentatively set to open on September 28, replacing Don Muang as the international hub. Euarng Luang would have targeted the mid-range market and was due to start flying later this year domestically and to neighbouring Laos, Cambodia and Burma. It had also planned to compete directly with low-cost carriers, including THAI's sister airline Nok Air, of which THAI owns 39 per cent. Nok Air operates low-cost fights on mainly domestic routes. THAI chairman Wanchai Sarathulthat had earlier said Euarng Luang would serve domestic passengers who preferred premium services. He said Euarng Luang would turn THAI back to the era when the Finance Ministry owned two airlines - Thai Airways and Thai International - for the domestic and the international markets, respectively. The airlines merged 15 years ago.
Suchat Sritama The Nation
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