Thai Airways International Plc (THAI) is teaming up with China's largest low-cost airline to help bring back tourists from the mainland over the next three months.
Last week THAI signed a memorandum of understanding with China's Spring Airlines in collaboration with Thai AirAsia, aiming to revive Chinese arrivals after a lull in the past few months.
Sumeth: Aircraft necessary for growth
July's deadly boat incident in Phuket and an economic slowdown in China are major factors for the decline. As a result, Chinese passengers on THAI have plunged by 10% in the third quarter this year, said executives of the airline.
Other airlines such as Bangkok Airways have also suffered declines, while charter flight services from China lost a number of customers.
THAI president Sumeth Damrongchaitham said under the agreement, Spring Airlines will help promote Thailand and carry more tourists into major airports -- Suvarnabhumi, Don Mueang and Phukets -- via its scheduled and charter flight operations.
THAI and Thai AirAsia will funnel Chinese tourists into second-tier provinces through their networks to support government's strategies to promote such destinations.
The Tourism Authority of Thailand (TAT) expects the collaboration among the three airlines will help strengthen Chinese tourism over the next three months, especially during Chinese New Year in early February next year.
TAT is also confident Chinese tourists will flock into Thailand after the government grants an exemption of visa-on-arrival fees, endorsed from Nov 15 until Jan 13, 2019.
Total arrivals from the mainland may drop by 6% during the final quarter this year, but the agency believes the annual total will grow to 10.5 million.
New aircraft needed
Mr Sumeth said the board of directors approved an aircraft purchasing plan on Monday for the procurement of 38 new aircraft, an increase from the 23 previously proposed.
The company will propose the plan to the cabinet for approval in December this year.
The airline is also continuing its business rehabilitation plans to enhance proficiency in all business units, improving services and seeking niche markets.
THAI management will submit the revised marketing and business strategies to Deputy Prime Minister Somkid Jatusripitak by this year.
Mr Sumeth said the airline expected to finalise new aircraft purchasing soon. The cabinet already approved in 2011 THAI buying 75 new aircraft to update its fleet.
He said THAI lost 3% market share to other airlines every year over the past three years because of a lack of aircraft.
The airline needs more aircraft to increase seat capacity as well as expand its network, said Mr Sumeth.
Joining PTTOR
THAI and PTT Oil and Retail Co (PTTOR) on Monday signed an agreement to increase revenue from non-core businesses.
Under the deal, Puff and Pie products from THAI's catering unit will be sold at five Cafe Amazon outlets in Bangkok and surrounding vicinity.
The airline plans to increase its Cafe Amazon selling points to 12 this year.
Ground sales of Puff and Pie are generating revenue of 420 million baht per year. THAI expects revenue from ground sales will increase by 13% for this year after joining PTTOR.
Total ground income for is set to increase to 1.4 billion baht in the next five years.