Thailand sees surge in airfares despite low travel season
Airfares in Thailand witnessed a substantial increase in the third quarter of this year, despite it traditionally being a low season for travel.
This surge was driven by a robust travel demand. Thai AirAsia, for instance, observed a 22% year-on-year rise in its airfares during this period, while Bangkok Airways’ rates saw a 15% hike.
The average fare price for Thai AirAsia during the quarter soared to 1,720 baht, a significant increase from 1,404 baht during the same period in the previous year. This fare also surpassed the 2019 level, which stood at 1,457 baht.
According to Santisuk Klongchaiya, the Chief Executive of Thai AirAsia, the airline had to raise its airfares by 15 to 20% for the current quarter to cope with the bustling tourism high season, all in the pursuit of returning to profitability.
In the third quarter, Thai AirAsia catered to 4.56 million passengers, achieving 86% of the 2019 level, with an impressive average load factor of 90%. This performance enabled Asia Aviation PLC, the major shareholder of Thai AirAsia, to secure 9.89 billion baht in revenue for the quarter.
Asia Aviation PLC also posted positive earnings before interest, taxes, depreciation, and amortisation (EBITDA) for the fourth consecutive quarter, with 389 million baht in the third quarter.
The company reported losses of 1.69 billion baht, a decline from 4 billion last year, primarily due to unrealised losses from baht depreciation. The Thai AirAsia CEO stated that the visa exemptions for visitors from China, Kazakhstan, India and Taiwan should boost arrivals until at least the end of the first quarter of next year. He also noted that falling fuel prices and a new domestic excise tax should benefit the industry.
For the first nine months, Thai AirAsia transported 13.8 million passengers and aims to reach 20 million passengers with an 87% average load factor for this year by utilising its 54-aircraft fleet.
Bangkok Airways’ airfare rise
Meanwhile, Bangkok Airways reported a 15% surge in its average airfare to 3,803 baht between July and September year-on-year. The airline’s president, Puttipong Prasarttong-Osoth, revealed that the increase in passenger numbers and higher airfares contributed to a 39.8% improvement in passenger revenue in the third quarter. The airline observed an EBITDA of 1.4 billion baht, marking a 182% rise from the same period last year, reported Bangkok Post.
Bangkok Airways catered to 967,800 passengers in the third quarter and 3 million over the first nine months this year, with a load factor of 78% in the third quarter. The airline also resumed some routes and introduced others, such as Samui-Hong Kong, Lampang-Mae Hong Son, and Bangkok-Maldives. As of September, Bangkok Airways operates 24 aircraft in its fleet, down from 35 at the end of last year.
