The scene is set for an air cargo war in Thailand's skies next year, as two more air cargo operators battle for freight business.
The two new cargo carriers are set to jostle with the 76 carriers already offering cargo space at Bangkok's Don Muang airport, in what is regarded as a gamble on economic recovery: freight rates offer low margins of profitability in the region.
First off the ground is Thailand's first all-cargo operator, Thai Air Cargo Company (TAC), which has won approval to operate to Burma, China, Korea, Hong Kong and Singapore from January.
TAC will have to add European and North American destinations within six months or lose its traffic rights, says aviation department director general, Sawat Sittiwong.
The government wants Thai Air Cargo to launch as soon as possible because it believes it will encourage exports and earn foreign exchange. TAC faces a difficult time ahead, however. An internal feasibility study suggests that the new operator would take five years to break even, says a government sources.
TAC's toughest hurdle may be competition from incumbent Thai International, which has decided to go ahead with plans to become involved in another, as yet unnamed, cargo operation of its own.
Thai's board has already given the go-ahead for a search for private investors for the new air cargo company. The government will limit Thai to a 40 percent share holding.
Thai chairman Mahidol Chantrangkun expects a separate cargo operation to strengthen Thai's current air cargo business in terms of joint marketing and sales.
Tom Ballantyne
Source: Airline Business
