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Thai Airways and Tiger Airways are to form a joint venture, “Thai Tiger”, to operate international and domestic Thailand domestic point-to-point services. The new JV, to be owned 51:49 by Thai Airways, raises the bar in low cost airline operations competition in Asia and could have a major impact on the pace of airline liberalisation in the region. Until now, the Thai government has been highly protective of its flag carrier and has been threatening to drag the chain on the ASEAN multilateral timetable for moving towards open skies for Southeast Asian airlines. This position could now soften, as high cost Thai Airways will have the opportunity to meet competition on a more equal footing. Some of this competition comes from AirAsia’s JV, Thai AirAsia, as well as from its own JV in low cost airline Nok Air (in which Thai currently holds a 39% stake).
According to a Tiger Airways media release, the new airline is to be based in Bangkok, operating “international and domestic flights out of Suvarnabhumi International Airport offering short-haul, point-to-point services within a 5-hour flying radius.” The agreement has clearly been consummated quickly in the last few hours, as Thai itself – never prompt to deliver news – has not yet announced anything and a hastily arranged media conference is to be called later this morning. Tiger is due to report later this week and would have been keen to have the announcement out in the open in advance.
However, in Tiger’s media release, Thai President, Mr. Piyasvasti Amranand, was personally quoted as saying, “we are pleased to partner with Tiger Airways in establishing Thailand’s newest airline, Thai Tiger. With its disciplined approach to the low-cost model, Tiger Airways has proven that it has the right approach to competing effectively in the growing low fare travel market in Asia. For people in Thailand and the region, our launching Thai Tiger will mean that in addition to the global network of premium services operated by THAI, more people will have access to new low fare, point to point services, giving a big boost to tourism and employment.”
Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.
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