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Flight bans hitting revenues, customers of Thailand-based airlines

[BANGKOK] A top Thai aviation official warned on Tuesday of an "unimaginable impact" on revenues and passenger numbers of Thailand-based airlines after three major Asian destination countries refused them permission for charter flights.

Prime Minister Prayuth Chan-Ocha vowed speedy action to get the bans lifted after Japan, China and South Korea stopped Thailand-based airlines from flying new charters and routes due to safety concerns highlighted by an international audit.

The head of Thailand's Department of Civil Aviation, Somchai Piputwat, said nearly 120,000 passengers wanting to travel to Japan alone would be affected in the next two months - a busy time for Thai travellers - because of the new restrictions.

"If we can't solve the problems (with the audit) in the next eight months, the impact will be unimaginable," Mr Somchai told reporters.

Thailand's ruling junta will allow the European Aviation Safety Agency (EASA) to inspect operations of the Thai aviation supervisory agency to help restore international confidence, the prime minister said.

"First we will let the EASA come in to create confidence," Prayuth told reporters, adding that the junta had set up committees to try to end the restrictions within a month.

Some 77,000 passengers who have booked flights to Japan for April and May with Thailand's largest long-haul, low-cost carrier Thai AirAsiaX will be affected by the Japanese ban, Somchai said.

In addition, some 27,000 passengers of NokScoot, 10,000 with Thai Airways International and 3,600 at Asia Altantic Airline will be affected, he added.

Long-haul, low-cost carrier NokScoot expects to have lost about 400 million baht (S$16 million) in revenue so far this year after Japanese authorities refused permission for 44 charter flights, the firm's chief executive Piya Yodmani said.

NokScoot will need to transfer about 20,000 passengers with flights to Osaka and Tokyo to Thai Airways in the period from March 30 to May 30, Mr Piya said.

NokScoot, a joint venture between Nok Airlines and Singapore Airlines subsidiary, has also delayed plans to launch new flights to South Korea, he said.

Thai AirAsiaX could lose some 150,000 passengers this year if Japan does not allow it to begin flights to Sapporo from July 1, chief executive Nadda Buranasiri said.

Thai AirAsiaX, part of Malaysia's AirAsiaX, has to reschedule flights to Japan to help the affected passengers, Nadda said, adding that the firm may miss its 2015 passenger target of one million people and lose some 500 million baht in revenues, currently forecast at 6 billion baht for all-2015.

Analysts said the restrictions have so far had limited impact on tourism into Thailand as charter flights account for only about five percent of total flights.

Surapong Techaruvichit, president of the Thai Hotels Association (THA), said he expected minimal impact on hotel bookings in Thailand during the peak Songkran period, or Thai New Year, next month.

REUTERS