Bank: Bright future for Thai aviation

BANGKOK Kasikorn Research Centre said Thailand’s aviation industry is now a driving force in the economy, but it still remains a tough contest for Thailand to become the preferred ASEAN hub.

The bank think-tank unit said positive trends were measured by passenger traffic between 2012 to 2015 at 31 airports (excluding Mae Sariang, Tak and Pattani airports) run by Airports of Thailand and the Department of Civil Aviation.

Annual growth has averaged out at 15.2%.

“This growth corresponds with airlines enlarging their fleets and expanding routes across Southeast Asia,” the bank analysis said.

Large commercial aircraft manufacturers predict that passenger traffic within Southeast Asia will reach 2.36 billion by 2035, representing growth of 6.0% per year higher than any other region where growth is expected to average 4.8% per year.

The centre added that Thai aviation should continue to flourish, spurred by route expansion in Southeast Asia.

“Thailand enjoys a strategic location in mainland ASEAN offering connections to Cambodia, Laos, Myanmar and Vietnam…if the country is successful in establishing itself as an aviation hub linking CLMV markets, Thailand aviation and economy will rapidly grow.”

Other agencies and aviation research institutions echo the bank’s sentiments noting that Thailand has the facilities, traffic and airline networks to become a hub for the Mekong region in mainland ASEAN.

However, when Indonesia and the Philippines are included in the equation, the Thailand aviation network is not so extensive and would face considerable competition to achieve the role of ASEAN’s preferred aviation hub.

That crown is more likely to be bestowed on Singapore as it has already embarked on a massive expansion of Changi airport due to be completed by 2025.

Thai airports also face considerable capacity and land space constraints. They are fast reaching their maximum passenger capacities and overcrowding in terminal buildings is has already common, the bank noted.

The centre estimates that by 2022, the number of passenger movements (embark, disembark) passing through the six major airports operated by AoT and seven under the control of the DCA could reach 238.4 million, equal to an average expansion of 9.5% per year.

The figure would exceed the airports’ capacity which the actual maximum aggregate capacity of the 13 airports in the same year would only be 192.7 million passengers per year, it said.

Thirteen airports

AoT: Suvarnabhumi, Don Mueang, Chiang Mai, Mae Fah Luang Chiang Rai, Phuket and Hat Yai airports.

DCA: Krabi, Surat Thani, Nakhon Si Thammarat, Trang, Udon Thani, Ubon Ratchathani, Khon Kaen airports.

The bank recommended that the focus should be on expanding these overcrowded airports, notably the two key airports of Suvarnabhumi and Don Meaung.

Kasikorn Research Centre is a subsidiary company of Kasikorn Bank, which conducts tourism and business research mainly on Thailand’s economy including tourism with reliable recommendations and indicators on business prospects.