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Thailand Airlines Losses Widen Due to Weak Tourism, Strong Thai Baht

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The airlines revenue dropped 4.2% due to slow growth in tourist arrivals and the strengthening of the Thai baht.

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BANGKOK – Carrier Bangkok Airways and smaller Thai airlines have reported second-quarter losses as they reeled from a decline in tourists and a strong Baht.

Bangkok Airways said that its second-quarter loss amounted to 698 million baht,(US$22,580 Million).

The airlines revenue dropped 4.2% due to slow growth in tourist arrivals and the strengthening of the Thai baht.

Tourist arrivals in Thailand in June rose just 0.89% from a year earlier, with visitors from China, declining 7.1%.

State-run Thai Airways reported last Friday a 6.8 billion baht (US$221 million) loss for April-June. Against 3.1 billion baht in the second quarter of last year. Blaming slow growth in tourism and intense price competition.

However, Thai Airways said that the government’s decision to waive visa fees until October could attract more visitors during the low season.

Airlines Look to Online Marketing as Baht Continues to Strengthen

The airline aims to increase revenue through digital marketing and sales via its app, the airline’s president, Sumeth Damrongchaitham, said.

The carrier said it would finance its planned procurement of 38 new planes to increase capacity by using internal cash flow, loans or issuing new shares.

Low-cost carrier, Nok Air Pcl (NOK.BK) reported a 796 million baht second-quarter loss due to a fleet reduction and a decrease in Chinese tourists, it said.

Rival no-frills airline Asia Aviation Pcl (AAV.BK), which owns Thai AirAsia, booked on Friday a 879 million baht loss for the quarter due to fewer Chinese tourists and a strong baht, which tempered demand from foreign tourists.

Asia Aviation said Thai AirAsia will launch flights to Cambodia and expects a recovery of Chinese tourists in the second half of 2019.

The baht THB=TH is Asia’s best performing currency, gaining around 5.5% against the dollar this year, helped by Thailand’s $17 billion current account surplus.

Source: Reuters

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