TAAX casts wide net to save growth plan

Thai AirAsia X (TAAX) is looking at Europe, China and Australia to drive a growth plan stalled by restrictions imposed by Japan and South Korea.

The country’s first long-haul low-cost carrier is conducting market assessments and checking regulatory requirements for regular flights to those new destinations from Bangkok, according to chief executive Nadda Buranasiri.

“We have to temporarily shift Japan away from our focus for future growth and look elsewhere for a growth engine until restriction issues are resolved,” he told the Bangkok Post.

TAAX’s growth plan, which was focused on soaring Thailand-Japan traffic demand, was bogged down by Tokyo’s March 29 ban on new charter and scheduled flights by Thai-registered carriers to Japan.

The Japan Civil Aviation Bureau (JCAB), along with the Korea Office of Civil Aviation, acted in line with “significant safety concerns” about Thailand’s aviation oversight voiced by the UN’s International Civil Aviation Organization (ICAO) in February.

TAAX had wanted to expand its coverage in Japan with additional cities and raise frequencies on the two existing routes to Tokyo (Narita) and Osaka.

TAAX’s daily flight from Bangkok to Sapporo, made possible by a reprieve given by the JCAB, is to terminate on Aug 1, just three months after its launch.

The airline last month decided not to seek another reprieve, extended by JCAB on a monthly basis, because the uncertainty in getting permits renewed had caused load factor to plunge.

TAAX found it too troublesome to continue using its Malaysian parent AirAsia X’s planes, pilots, crews and airline codes as a condition for flying the Bangkok-Sapporo route.

The decision to drop the route came a week after the ICAO publicly flashed a red flag against Thailand, further tarring the Thai aviation industry’s reputation.

But TAAX’s twice-daily services to Tokyo (Narita) and daily flight to each Osaka and Incheon have remained unchanged by the ICAO issues and continue to form the airline’s entire revenue stream.

“China is under our microscope [for flight expansion] because Beijing is not taking a hard-line attitude towards Thailand like Japan, so the chance of us spreading our wings to China is more possible,” Mr Nadda said.

He did not name the Chinese cities involved, but they are understood to be four or more flight hours from Bangkok — meaning TAAX will not overlap with sister airline Thai AirAsia’s Chinese coverage, whose maximum range is three and a half hours flight time from Bangkok.

Turkey will be TAAX’s entry point to Europe, and Australia will represent the airline’s southward expansion.

According to Mr Nadda, TAAX will conclude the expansion plan in the next three or four months, with the new routes to launch in the fourth quarter of this year.