Pperators reducing routes, flights

The cost of fuel is approaching 50 per cent of overall operating costs, higher than 30-35 per cent last year. As a result, all operators, particularly budget airlines, are facing a tough time and are seeking new strategies to reduce costs and earn more revenue apart from traditional ways.

Nok Air, a budget airline affiliated to Thai Airways International, has decided to suspend its only international route, Bangkok to Hanoi, from June 1. The airline started service to this emerging destination last November with 14 flights a week.

"It is a temporary halt due to the oil-price increases that exceed operating costs and we have no immediate plan to resume the service," said Sehapan Chumsai, executive vice president of Nok Air.

Meanwhile, the operator will soon cut the number of flights on weekdays to several destinations from Bangkok, Chiang Rai, Phuket and Ubon Ratchathani.

The company has also postponed overseas expansion plans, including flights to India, Macau and other destinations in China.

However, it has not raised its fuel surcharge of Bt650 per sector.

Sehapan said the airline is considering revising it revenue projection for this year, based on fares from two million passengers, due to the fluctuation of many costs.

However, the airline believed its load factor would remain at 75 per cent this year. Yesterday it introduced a new promotion prepaid card called Nok Flexi Card, which consists of four domestic flights at an average net price of Bt2,375 one way. The campaign is expected to sell 1,000 cards.

Last week, One Two Go, another low-cost airline, announced it would cut flight frequency on most domestic routes and increase its fuel surcharge from Bt650 per trip to Bt750.

Its chief executive officer, Udom Tantiprasongchai, also said One Two Go would focus more on cargo operations due to greater opportunities in that area.

According to local news agencies, budget airline Thai AirAsia is planning to cut the frequency of its flights during June and September.

CEO Tassapon Beileveld said the airline would reduce the daily number of Bangkok-Hat Yai flights from six to five, Bangkok-Chiang Rai flights from four to three, Bangkok-Phuket flights from eight to six and Bangkok-Krabi flights from three to two.

Tassapon said the company decided to revise operations because the number of passengers over the next three months will drop. However, the airline will resume full services in October, which is the beginning of the tourist high season. He said the airline had added Bt50 to its fuel surcharge and would maintain this rate during the coming low season.

The airline said its average load factor during the first four months of this year was 78 per cent and it expected 4.6 million passengers this year.

Thai AirAsia is also planning to cut its weekly flights to Burma from seven to three within the next two weeks in the wake of Cyclone Nargis.