Nok Air is to receive its first of 12 B737-800 aircraft this week as the domestic low cost carrier embarks on a new phase of growth. This aircraft will enter service next week on the Bangkok-Chang Mai route, before two additional B737-800 deliveries are taken in November and January. These aircraft will be uses to expand capacity, while the remaining nine will act as fleet replacements over the next four years.
Nok also plans to expand its ATR 72 fleet from two to seven aircraft as it looks to exploit small markets under the sub-brand Nok Mini. According to CAPA, Nok Air’s CEO Patee Sarasin signed a deal on two ATR aircraft last week, scheduled for delivery in January.
The fete of Thailand’s low cost carrier was being questioned by many after shareholder Thai Airways International (THAI) entered talks with Tiger Airways regarding budget carrier Thai Tiger and then announced the launch of its owns subsidiary Thai Smile.
However THAI has recently reaffirmed its commitment to Nok Air by upping its share in the company from 39% to 49% and taking five of nine board positions. According to CAPA, Nok’s management team simultaneously raised its company stake six-fold to 30%. Commenting on the change to ownership stakes, Sarasin said the airline would now be able to pursue faster growth as it will have fewer owners and one owner with a near majority stake.
This little bird is now entering the next phase of its development, focusing entirely on the domestic market, where it already has a 20% market share. The plan is to protect and build on this share of the market and Sarasin has no immediate ambitions to launch international operations given the success the carrier has had so far. In its seven years of operations, Nok Air has generated US$50 million in profits, registering recovered losses in 2007 and 2008 due to rocketing fuel prices and falling demand.