ASEAN KEY DESTINATIONS
Indonesia's Lion Air setting up in Bangkok to capture Asian market
Indonesia’s largest private airline, the Lion Group, is establishing Bangkok, Thailand, as its latest hub through its new subsidiary, Thai Lion Air, to expand to Thai cities and other cities in the region.
The expansion will see the introduction of 50 new aircraft over the next five years to capture the growing aviation market across Asia, despite the parent company’s notorious reputation for flight delays at home.
Thai Lion Air CEO Capt. Darsito Hendro Seputro said the new airline would not only operate Boeing 737-900 Extended Range (ER) planes but also two Boeing 787 Dreamliners for medium- and long-haul routes, such as to Japan and South Korea.
“The expansion to Thailand is important because the market of low-cost carriers is booming here. A lot of tourists and business travelers alike from Asia’s large markets in China and India travel to Thailand,” Darsito said in Bangkok on Thursday.
“We are optimistic that we will stand out amid the highly competitive low-cost carrier sector in this country.”
While declining to disclose the amount of investment the new firm spent on its establishment, he said an airline needed at least 200 million baht (US$6.43 million) in start-up capital.
Darsito also said that Thai Lion Air’s position was crucial to strengthen the group’s network ahead of the 2015 ASEAN Economic Community (AEC), in addition to providing better services to its passengers from Indonesia and Malaysia.
As with Chinese and Indian travelers, many people from Indonesia and Malaysia made frequent trips to Thailand every year, he said.
Thai Lion Air will be able to connect Lion Air and its feeder, Wings Air, which offer flight services across Indonesia, as well as Malindo Airways in Malaysia to its Thai network.
“We will provide better connections for those passengers who usually continue their journeys [from Indonesia and Malaysia] to Thailand with other carriers. The Bangkok connection will make their trips easier,” Darsito said.
He said the airline was one step away from obtaining an Air Operator Certificate from Thailand’s Civil Aviation Directorate.
The new budget carrier, which is expected to commence operations in early December, will serve international routes Bangkok–Jakarta and Bangkok–Kuala Lumpur (Malaysia) with connections to Thailand’s domestic network through its Bangkok–Chiang Mai route.
The airline will provide all its flights twice-a-day from its base at Don Mueang International Airport, which is 15 kilometers from the capital.
Darsito said the airline wanted to connect Bangkok with Guangzhou in China, Hong Kong, New Delhi in India and Singapore, starting next year.
It is currently processing route permits with respective countries.
The airline also aims to cover other key domestic destinations, like Phuket and Hat Yai, from the airport, also starting next year.
Lion Group public relations head Leithen Francis said the group had been developing its human resources and maintenance facilities to meet its future needs.
Lion Technic, a maintenance training organization, currently hires 2,500 engineers, but its workforce is set to increase as the group grows bigger.
“We are also building a heavy maintenance facility in Batam [Riau Islands] with four hangars; the first two hangars will be completed at end of this year and the remaining two by the end of June ,” Leithen said.
Thai Lion Air is 49 percent owned by the Lion Group and the remaining 51 percent in the hands of two Thai businessmen, whose names were not disclosed.
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