A true aviation pioneer
From forays into duty- free shopping to building its own airports, Puttipong Prasartthong- Osoth and Bangkok Airways have always known how to stay one step ahead.
angkok Airways, the country’s first privately owned domestic airline, was started with the vision it would be the leading airline in Asia. Puttipong Prasartthong- Osoth, president of the airline, is dedicated to the twin pillars of safe delivery of passengers with exceptional service, and maximising shareholder return.
This vision helped the airline overcome difficulties and still provides the bedrock as Mr Puttipong works to push its businesses forward.
“All operators need to build their own strength and unique character if they want to stay in business,” he says.
“I took over as president in 2008, succeeding my father. He still gives me advice as the company’s chief executive. My bosses are the board of directors and the CEO.”
As the oldest son of Prasert Prasarttong- Osoth, the airline’s founder and owner, Mr Puttipong controls Bangkok Airways Plc together with affiliated businesses including three airports — Samui in the Gulf of Thailand, Sukhothai in the North, and Trat on the east coast — as well as Bangkok Flight Services, a passenger and ground services provider at Suvarnabhumi airport, and Bangkok Catering, an air caterer.
Bangkok Airways recently acquired a new business unit called More Than Free to operate a full range of duty-free business, including the acquisition of small operators that have managed shops at U-tapao, Samui, Surat Thani and Luang Prabang airports.
The venture into duty- free business is to capitalise on the growth of travel and tourism.
“We may need to join with world-class operators to gain business experience,” says Mr Puttipong.
More than 3,000 people work at Bangkok Airways group, of which some 2,000 are involved directly with aviation such as aircrew, technicians and pilots.
50YEARS OF SERVICE
This year the airline is celebrating its 50th anniversary.
“Throughout our five-decade journey, it was exciting the whole way. We eventually made it here and now we feel like we can be ourselves,” he says.
The story of Bangkok Airways started in 1968 when Dr Prasert, a former surgeon, established an airline named Sahakol Air as a department in his own company called Krungthep Sahakol. The airline operated as a charter flight service based on market demand.
In 1984, the airline separated to become its own company and has been operating as Bangkok Airways since.
In 1986, Bangkok Airways commenced operation of scheduled flight services, flying from Bangkok to Nakhon Ratchasima, Surin and Krabi, using an 18-seat Bandeirante EMB 110 aircraft.
“We are among the first private airlines to receive permission from the government to offer passenger service,” says Mr Puttipong.
It was not common at that time for private firms to run airlines as people believed such services should be owned and operated by only state-run airlines.
“We were confident we could make it, though the government did not allow us to fly duplicate routes operated by the national airline,” he says.
Since then, the airline has tried to offer different services to change customers’ perception of air travel.
SAMUI AIRPORT KEY
Bangkok Airways used clever tactics to ensure its survival, such as deciding to build its own airport in Koh Samui in 1984, which helped transform the island to an international tourist destination. Operations at Samui airport started when it was granted permission to operate flights between Bangkok and Samui in 1989, with a 37-seat DASH 8-100 aircraft.
“The government granted licences to the private sector, but it did not have an open sky policy yet so we had to find land on the island for the airport,” says Mr Puttipong.
The airline also began to fly overseas during that time, opening its first sales office in Paris. The new sales distribution brought in many customers not only from France but also all over Europe.
Samui routes contribute 50% of passenger revenue, with 30% from regional routes and 20% from domestic routes.
Later, the airline began to operate domestic and international routes, linking Bangkok with major heritage tourism sites such as Siem Reap in Cambodia, Luang Prabang in Laos, and China’s Xi’an, Guilin, Jinghong and Chiang Rung.
CHALLENGE OF LCAS
The biggest challenge for Mr Puttipong happened about a decade ago when low-cost airlines (LCAs) emerged. Their popularity has changed the favoured transport mode for Thais from land travel to air.
LCAs gave Thais more attractive pricing options combined with slick marketing.
Within a short period, LCAs grabbed a large market share, not only from Bangkok Airways but every player in the market. This forced the airline to adjust and consider what it really needed to do.
“We thought about it for a while and finally realised there must still be some demand for full-service carriers. We determined our new direction,” he says.
The airline decided to reposition itself as “Asia’s Boutique Airline”, committing to full service, with a boutique airport and lounge, great connectivity, and on-board services.
“The only task during rebranding was telling passengers we are different from other airlines,” says Mr Puttipong.
During 2008, the airline faced another challenge as the global economic crisis happened just days after he took over as president.
During the crisis, fuel prices rose from US$40 per barrel to $150, increasing operating costs by 30-40%. That hike forced the airline to cut its route network by 50%, including routes to China, Japan and some domestic routes.
Moreover, it had to postpone aircraft delivery and offer staff early retirement packages.
The silver lining to the crisis and baht depreciation was it encouraged a mass of foreign tourists to visit Thailand because the trip was much cheaper.
“With travel in Thailand much cheaper than previous years, tourism rebounded remarkably as foreigners flocked to the country for vacation. Thailand became one of the most visited countries in the world,” he says.
The global crisis put Bangkok Airways’ ledger in the red from 2007, not returning to the black until 2010.
The ups and downs have given Mr Puttipong valuable experience. One major lesson the airline learned from the crisis is businesses need alliances.
Since the crisis, the airline has worked with other airlines, both domestic and overseas, to tally 26 airline alliances currently, among the highest count in the world.
The alliances help Bangkok Airways maintain markets even if it does not have any operations in those countries.
“The airline has faced many obstacles, but amid crisis, we can find opportunity,” he says.
As of June 2018, Bangkok Airways operates to 15 destinations across South Asia, North Asia and Southeast Asia, and 12 destinations in the domestic market.
There are 39 aircraft in the fleet, scheduled to increase to 43 in 2020. New jets will allow the airline to increase capacity.
“I give all the success to my team as they have helped the company to drive business forward in many ways. They brought in many new customers during the crisis,” says Mr Puttipong.
He believes the tourism industry will continue to grow because of Thailand’s unique services and kindness as well as a range of attractions from culture to nature, local experiences and global events.
The cost of travel also remains about 50% lower than some cities such Singapore or Yangon.
He says his management style reflects his belief that the most important part of the business is staff.
“Quality employees reflect our success. If passengers are impressed with our service, they will return to use our airline and stay with us for a long time,” says Mr Puttipong.
“My working philosophy is to make every day better. I am dedicated to the best customer service and making people feel good. I also like to know every single detail because it will help me make the best decision.”
While advanced technology is needed for an airline, he believes service is about people and their mindset.
I give all the success to my team as they have helped the company to drive business forward in many ways. PUTTIPONG PRASARTTHONG-OSOTH BANGKOK AIRWAYS PRESIDENT
Bangkok Airways president Puttipong Prasarttong-Osoth has learned the importance of airline alliances.
Mr Puttipong sits beside his father, Prasert Prasarttong-Osoth, a former surgeon and founder of the airline, who also owns the hospital chains of Bangkok Dusit Medical Services.
A Bangkok Airways jet sits ready on the apron at Samui airport.
Mr Puttipong and staff on the airline’s first trading day, Nov 3, 2014.
A Bangkok Airways flight attendant takes orders.