Passenger traffic after Thailand’s reopening on Nov. 1 has failed to meet operators’ expectations as demand from foreign tourists has declined, Nok Air’s CEO said.
“The airline has taken up and resumed operations nationwide, but passengers and revenue are not even 40% of 2019 levels,” said Wutthiphum Jurangkool, CEO of Nok Air.
He said the airline’s international passengers at Don Mueang Airport made up less than 1% of the pre-pandemic total in November. Some tourists have booked national flights from Phuket to Chiang Mai, but demand remains extremely weak.
Domestic passenger numbers also pale in comparison to the same period last year, despite the economic stimulus program “We Travel Together”.
Nok Air had 80 daily flights in November last year, but frequencies have recently dropped to 60 flights, despite load factors increased from 70% in 2020 to 83% last month.
Due to the slow recovery, Wutthiphum said the airline will need to accelerate its plan to secure a 280 million baht loan in the first quarter of next year to support cash flow.
The airline is awaiting government approval to add six new Boeing 737-800 jets.
Nok Air expects to have 19 aircraft in service by the end of this year. Three Q400 jets will be decommissioned to restructure the fleet and clear the way for six new planes, he said.
Wutthiphum said the airline’s revenues could fully recover within two years if tourists from mainland China are allowed to travel abroad in October and the airline can get new planes as planned.
It will also have to evaluate the effects of the Covid-19 Omicron variant worldwide.
Regarding his debt restructuring plan, Mr Wutthiphum said creditors who are passengers and former employees received payments from the airline in November after the central bankruptcy court approved the plan on September 29. The number of creditors is now below 100, he said.
Nok Air plans to resume international flights to Japan (Osaka), India (Hyderabad) and Taiwan in April next year. Routes to regional countries such as Vietnam may resume earlier if demand is sufficient and travel rules are relaxed.
A new domestic route – Nakhon Ratchasima to Chiang Mai – is planned for April, followed by Nakhon Ratchasima to Surat Thani, Hat Yai, Nakhon Si Thammarat and Phuket in late 2022.
Wutthiphum said Nakhon Ratchasima has less competition because it has a short runway for which only two airlines have compatible aircraft. He said there is demand from this city, but the government should subsidize operating costs so that airlines can add more flights from this destination.
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