Small regional carrier Air Andaman has become the first casualty among those battling it out for a share of Thailand's domestic market, but new entrants continue to launch.
Privately owned Air Andaman, which launched domestic services late in 2000, had been in financial difficulty for some time and at the time of its shutdown was operating a single wet-leased BAe 146. It now has new owners and is aiming to restart services in May as an international passenger carrier using Boeing 737-400s.
Thailand saw the launch of a handful of small airlines around 2000 and 2001, among them Air Andaman and Phuket Air. These carriers each took over some of national carrier Thai Airways International's loss-making domestic routes. But the market is now even more crowded, following the December 2003 launch of low-fare carrier One-Two-Go and the February launch of Thai AirAsia, a local offshoot of Malaysian low-fare carrier AirAsia.
In the coming months another new low-fare carrier, Nok Air, is due to enter the market. The minority owner of Nok Air is Thai Airways.
Together with the handful of other more established airlines already operating in Thailand, the smaller carriers are finding it more difficult to compete. Air Andaman, which operated most of its services on behalf of Thai, had been in dispute with its largest creditor, Dutch aircraft leasing firm Aircraft Finance & Trading (AFT), for some time over unpaid lease fees on three Fokker 50s, as well its failure to make payments on a loan. Soon after its shutdown, a settlement was reached with AFT and Air Andaman is now eyeing a relaunch.
Private investors led by a hotel manager, Dean Mills, have agreed to inject fresh funds into the carrier in return for an undisclosed stake. The new owners are planning to focus on the international market rather than on secondary domestic routes, with services to Singapore, India and China. The owners say the relaunched carrier will be offering "low fares but a premium service".
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Source: Airline Business
