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AirAsia to focus on boosting non-air-ticket income

Thai AirAsia aims to push non-air-ticket income to a quarter of its total earnings, Tassapon Bijleveld, executive chairman of Asia Aviation Plc (AAV) and Thai AirAsia Co Ltd (TAA), said.

Thai AirAsia is planning to generate additional income to keep the airline business afloat during the Covid-19 crisis, Tassapon said.

“Currently our food delivery business generates around Bt150,000 per month, while our latest “Unlimited Pass” campaign has generated around Bt100 million,” he said.

“We are expanding into the non-air-ticket market by promoting Thai AirAsia to be a travel digital platform that sells hotel reservation, concert tickets, European train tickets as well as car rental services to travellers worldwide.

“In the future, we aim to become the community digital platform that sells agricultural produce from farms as well as other local products directly to customers with 48 hours delivery,” he added.

Tassapon added that currently non-air-ticket income is responsible for 18 per cent of the airline’s total income. “We are pushing to make non-air-ticket 25 per cent of our total income,” he said. “Currently the profit ratio of non-air-ticket income is at 50-80 per cent, while that of the air ticket is only 2-5 per cent. In the future we might sell air tickets at a loss only to expand customer base and then focus on promoting other services that have higher ratio of profit to revenue.”

Thai AirAsia predicted that the airline industry will take until mid-2020 to fully recover from the impact of Covid-19.

“It had been earlier estimated that this year Thailand would have 8 million foreign tourists, while so far we have only seen around 6.2 million,” added Tassapon. “With the current outbreak situation, we can only rely on the travel bubble policy, which is estimated to bring only around 500,000 foreign visitors until the year-end, meaning the industry will miss its target by a lot.”

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