Skies not very open for Nok Air’s rivals

Nok Air, Orient Thai Airlines, PB Air

The Bangkok Post has an interesting piece Friday on Thailand’s “open-sky policy”, which at least on the domestic horizon, does not seem to be as open as authorities claim. Both PB Air and One-Two-Go by Orient Thai are complaining that Nok Air (which is 39% owned by government-controlled THAI) is receiving preferential treatment as THAI ditches its loss-making domestic routes. Nok Air is effectively subsidised by THAI, leasing its aircraft from THAI at book value + 1%, while its domestic rivals have to lease at market rates. It also receives subsidised maintenance fees competitors have alleged — hardly a level playing field. The fares reflect to an extent this disparity in costs, with PB Air charging 3,180B for a flight to Nakhon Si Thammarat, while Nok Air can fly the same route for as little as 1,250B — who would you fly?

Prahok @ October 28, 2005