Following a successful streak in 2023, Thai AirAsia has encountered a downturn in demand during the second and third quarters, prompting the need for immediate government intervention to address the stagnant local purchasing power.
Santisuk Klongchaiya, CEO of Thai AirAsia, noted that the anticipated seasonality in tourism had materialized this year, with the domestic market’s average load factor decreasing to 90% in the second quarter from 94% year-on-year.
While the airline experienced robust performance in 2023 due to pent-up demand post-pandemic, the domestic load factor saw a slight dip from the first quarter’s historic high of 96%, as travel patterns normalized with the return of tourists during the high season.
On international routes, the carrier’s average load factor in the second quarter increased to 90% from 83% in the same period of 2023, remaining consistent with the first quarter of this year.
However, the full recovery of the airline and the tourism sector hinges on the Chinese market, with the likelihood of achieving the government’s target of 8 million tourists in 2024 being slim. Santisuk mentioned that stimulating demand is crucial, especially with the proactive promotion of domestic tourism by the Chinese government.
Thai airlines continue to advocate for a reduction in the jet fuel excise tax, currently at 4.726 baht per liter, to lower travel expenses for domestic travelers.
Thai AirAsia plans to launch 4-6 international routes in the latter part of the year, including destinations like Hyderabad (India), Kathmandu (Nepal), and Phu Quoc (Vietnam). In terms of domestic routes, a new service to Lampang will commence in October, marking the airline’s 25th domestic destination and increasing domestic flights to 612 per week across 35 routes.
The airline aims to operate with 60 aircraft by the end of the year, a slight improvement from the pandemic period but still below pre-pandemic levels.
Somradee Chitchong from the Tourism Authority of Thailand highlighted that tourism receipts in Lampang primarily stemmed from local travelers, emphasizing the importance of domestic tourism in driving economic activity in the region.
