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Bangkok Airways realigns capacities to boost revenues

Luc Citrinot, eTN  Oct 20, 2010

BANGKOK (eTN) - Far from the sometimes pioneering - but rather romantic - vision of his father and far from the marketing gimmicks behind the "boutique airline" brand concept, Bangkok Airways' current CEO, Captain Puttipong Prasarttong-Osoth, takes a more pragmatic approach to managing Thailand’s largest regional carrier. Decisions are now driven by the need to increase the company’s turnover and profitability. Peter Wiesner, vice president of network management explains in exclusivity to eTurboNews how the new visions of the president of Bangkok Airways will be achieved.

eTN: Bangkok Airways is confronted to challenging times due to internal and external factors. How is the airline doing so far?

WIESNER: We aim to transport this year 2.8 million passengers, up from 2.5 million a year earlier with revenues of THB 8.2 billion [US$273 million] with foreign passengers accounting roughly for 80 percent of our total traffic. We remain confident that we will hit the mark of three million passengers in 2011 as growth is sustained by booming consumption all around Asia.

eTN: In the last few years, Bangkok Airways’ network development seems to have slowed down compared to previous periods. Is this a real shift in strategy?

WIESNER: Our aim is to make better use of our fleet by shifting aircraft and modifying time schedules to increase frequencies and offering better connecting times. We have in mind a target of offering in our winter schedule at least a daily flight to all our routes, except for Phuket-Samui-Trat where we only operate four times a week and Bangkok-Maldives with 3 weekly flights. However, we are boosting frequencies in many other routes. We now fly six times daily between Bangkok and Phuket offering even the first flight of the day out of Phuket. We have also increased flight frequencies between Bangkok and Phnom Penh to four daily flights and reschedule morning and evening departures to offer to both markets up to 12 hours of work in each city.

eTN: Many flights are also rescheduled this winter. Why?

WIESNER: We are looking particularly to offer more efficient connections for passengers. For example, by pushing back our flight Bangkok-Rangoon departure time to 3:10 pm in the afternoon, we offer now an ideal pattern to passengers arriving from Europe such as the ones on Air France/KLM or Austrian but also to passengers arriving from our other destinations. For Phnom Penh, we now provide the shortest connections for our partner Etihad and Air Berlin. We even offer now the best possible transfer times for passengers wishing to fly between Phnom Penh and Rangoon, a route with some 3,000 travelers a year!

eTN: You are also boosting your presence in Phuket. Is the island becoming so important for all airlines around the world?

WIESNER: The events which affected Bangkok in the last few years have certainly benefited Phuket with a growing number of international visitors looking now to come directly to Phuket seen as an alternative international air gateway to the country. We fly up to five times daily between Phuket and Samui as we see more and more a market of travelers looking at spending a first week in Phuket with its big choice of activities and entertainment and a second week in Samui for relaxation.

eTN: For years, Bangkok Airways looked like a pioneer in promoting the Greater Mekong subregion. Is that still the case today?

WIESNER: We are still very committed to serve all countries in the GMS and especially in Indochina. However, I must admit that we have for now reached a certain limit due to the market’s limitations. Unlike Vietnam Airlines, we do not benefit from a complete Open Sky policy in the GMS, as the agreement excludes Thailand. In Cambodia, our Siem Reap route has suffered from a decline in total arrivals to the destination from both European and Japanese customers. We will certainly come back to Vietnam in two years time, flying to either Hanoi or Ho Chi Minh City or both. We would love to serve Hue, but this airport is still not open for regular international flights. In Myanmar, we are interested with Bagan' but this is not possible due to the absence of immigration services at the airport. We also look at serving soon Vientiane in Lao PDR.

eTN: For years the "Boutique Airline" concept has been successful. However, with low-cost competition offering very attractive fares, do you not think that this slogan scares potential travelers, as it depicts the airline as expensive?

WIESNER: We can’t be compared to low-cost carriers, as we offer a completely different product, which includes service on the ground and on board, as well as the possibility of through check-in from almost anywhere around the world. However, it is true that we can give a perception of being expensive, and we try to correct this image. We offer on our website extremely attractive fares, which can even match the prices proposed by our competitors. We, for example, recently launched special fares on the web for Bangkok-Samui starting from THB 890 [US$29.90] one way. We attracted then many new customers who never flew with us before, and we aim to continue in this direction to enlarge our potential.

eTN: How about joining an alliance?

WIESNER: We have a very extensive cooperation with many carriers around the world, which makes joining an alliance not that attractive. We also have to look at the cost it represents for an airline of our size to join and the benefits we could get. Being without an alliance does not mean that you cannot prosper in the air transport industry today. Look then at hotels - besides large international chains, there are still many independent hotels operating extremely successfully thanks to their niche position!

Bangkok Airways realigns capacities to boost revenues
Photo from Bangkok Airways

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