Thailand’s two prominent airports are set for extensive expansion, with the operator planning a hefty $4.8 billion investment to double their capacity by the end of this decade to accommodate the expected surge in tourism post the Covid-19 pandemic. The Airports of Thailand (AOT) Public Company Limited disclosed these expansion plans, marking the most significant advancement of Suvarnabhumi airport since its inauguration in 2006.
The comprehensive expansion project at Suvarnabhumi includes the construction of two new runways, a new terminal, and expansion of the existing passenger terminal. These developments aim to increase the airport’s annual capacity from the current 60 million travelers to an impressive 135 million. Estimated to cost around 140 billion baht ($3.7 billion), these upgrades signify a substantial commitment to meet the growing demands of air travel.
In parallel, a new international terminal is set to be constructed at Don Mueang airport in Bangkok, along with the renovation of the existing facilities. These improvements, estimated at 36 billion baht, will raise the airport’s capacity to 50 million passengers annually by 2030 from the current 30 million. Don Mueang airport predominantly caters to regional and budget carriers.
Funding for these projects will primarily come from internal revenue sources of AOT, with considerations for bank loans only if necessary as confirmed by an official. AOT’s financial outlook appears positive, with analysts forecasting a more than twofold increase in net income to 21 billion baht for the fiscal year ending in September.
Moreover, AOT expresses interest in participating in the bidding process for constructing two new airports proposed by Prime Minister Srettha Thavisin. These new gateways in Chiang Mai and the Andamans, if approved, would further bolster Thailand’s aviation infrastructure, aligning with the vision to establish the country as a regional aviation and logistics hub.
To enhance Thailand’s positioning as a tourist magnet, the government focuses on ensuring seamless travel experiences for the millions of visitors. Efforts to modernize and streamline processes at airports like Suvarnabhumi aim to rival regional competitors such as Singapore’s Changi Airport, known for its exceptional services.
Despite the disruptions caused by the pandemic, Thailand remains optimistic about tourism recovery, targeting 35-40 million foreign tourists this year with ambitions to attract 80 million visitors by 2027. To achieve these goals, innovative strategies such as introducing casinos within large entertainment complexes and promoting event-based tourism are being considered to boost revenue generation.
AOT’s shares have shown resilience amid the challenges, reflecting investor confidence in the company’s strategic growth initiatives amidst a recovering tourism landscape.