Thai - Struggles To Find A380 Role ? Civil Aviation Forum ...

The print edition of Aviation Week for October 8th has a story about Thai and its efforts to find a niche for the A380 in its fleet. Basically when TG ordered its 6 A380s in 2004 the carrier envisaged deploying them on the dense and profitable routes connecting Europe to Australia via its Bangkok hub. However in the intertwining years these once historically important routes for TG have "deteriorated" as competitors have successfully eaten into the traffic. For instance London once a prime European market with multiple daily 747s is where "performance has been highly impacted by fierce expansion of Middle Eastern carriers" and is now served by smaller A340 fleet, and can no longer support the 507 seat A380 economically as original envisaged. Against this back drop per TG VP of Strategy and Business Development Chokchai Panyayong, the company has been forced to find a new role for the A380 in its network. Thankfully the carrier has seen continued growth and profitability on intra-Asia traffic which has led it to deploy the A380 on short hops to Hong Kong and Singapore initially. The carrier foresees only minimal long haul routes for the A380 such as to Star hub Frankfurt and possibly to Sydney but the majority of future use will be regionally including Tokyo, Osaka and added frequencies to Hong Kong, vastly different from the original intent for the longhaul jumbo. Certainly some interesting comments. Seems the A380 is a bit of a non-needed aircraft for TG today. I suspect others like Malaysian might be in the same boat with its A380s arriving at a time its network and global markets no longer perform they did when the aircraft were first ordered.

69 replies: All unread, showing first 25:

Would the changing market have been the reason TG wanted to cancel their A380's some time back?

Might Thai consider reconfiguring its A380s to a denser configuration? Right now TG's A380s have 12 F, 60 J, and 435 Y. Or consider changing it for the aircraft they still haven't taken delivery on?

Amazing they ordered and waited 8-years for the aircraft. Yes many things change in a decade. The once bread and butter routes turn moldy.

I think most carriers are having trouble placing the 380, other than EK. MH certainly will, EU carriers seem to move them all over the place. This is just the beginning. Carriers were having trouble placing their 744s, never mind larger aircraft.

Quoting LAXintl (Thread starter): Certainly some interesting comments. Seems the A380 is a bit of a non-needed aircraft for TG today. I suspect others like Malaysian might be in the same boat with its A380s arriving at a time its network and global markets no longer perform they did when the aircraft were first ordered. I suspect so as well. IMO TG and MH were two "me too" carriers when they ordered this aircraft. Reminds me of the likes of EA, AA, DL and some others back when the 747 frst came out. Yeah, I am old enough to remember that ??

Quoting bonusonus (Reply 2): Might Thai consider reconfiguring its A380s to a denser configuration? Right now TG's A380s have 12 F, 60 J, and 435 Y. Or consider changing it for the aircraft they still haven't taken delivery on? That's always an option, but I'm not sure how much there is in that config without sacrificing up front revenue. 12F can definitely be reduced (seems like 8 is the popular choice nowadays), but 60J seems kinda scrawny as-is. They could probably get away with something like 4F/~75J/~450Y, but I think you run into a problem of how many Y seats (especially discounted fare buckets) can you cram in there and still make a buck on the route? Even if premium demand is down, some of that is F->J with better J product, and I'd venture to say even discounted J tix often do better for the bottom line than Y, even accounting for J being more expensive per pax. So at some point above 435 there is going to be a tradeoff, and a practical ceiling on how many seats are viable.

Quoting mercure1 (Reply 3): Amazing they ordered and waited 8-years for the aircraft. At the time they ordered it, they needed it. Once they didn't need it, they were not in a position to cancel them so now they have to make use of them where they can. The A380-800 and 777-300ER do give TG a fresh and efficient long-haul fleet, so that will hopefully start to drive up demand and allow the A380-800s room to grow into. [Edited 2012-10-15 09:41:25]

Well in theory if the bulk of the fleet operations will be doing things like short 120 minute hops to places like SIN and HKG one does have to wonder about the configurations. At the very least a denser and less opulent premium regional product might be more appropriate. You don't need lie flat beds and enclosed F class suites. As seen on other models TG does seem to like to have configuration variations including a more spartan regional configuration in its fleet.

Ironic that Emirates A380 expansion seems to be killing off the A380 requirement for other airlines. Maybe the world only needs a finite number of A380s, whoever operates them. And this is at a time when UAE only has a quarter of their envisioned fleet.... As for 'me too' airlines (!), why do I immediately think of a certain UK airline?

I think Thai can stand the competition from thr ME carriers with the 380. When they put them on the routes to FRA and SYD most of the 6 frames will be deployed. It wont be a problem to find regional employment for the rest of the capacity. Perhaps Thai can gain back some traffic volume over competitive prices and a good new product on the 380. With LH perhaps switching to the 346 to BKK pressure on this route might be a bit decreased.

Could they lease them out? It seems like EK can't wait to get their orders filled. Thai could lease them out to Emirates, but then again, that would probably make the whole problem even worse. Soren ??

Perhaps TG should have gone for the HGW 590 tonnes version and re-instate the LAX non-stop, that's only about 300 miles further than QF's MEL-LAX that non-HGW A380's do. Meanwhile, wonder if Moscow could work for TG 380's, seeing UN use high-density 744's to BKK.

Quoting fcogafa (Reply 9): Maybe the world only needs a finite number of A380s, whoever operates them ?? Especially if they're all pretty much all in Eurasia. Quoting Hirnie (Reply 10): I think Thai can stand the competition from thr ME carriers with the 380. I find it a little hard to believe that TG can't compete with the ME carriers. EK has 6 daily BKKDXB flights; TG should be able to overfly DXB a bit more, but not with a 380.

I never expected the BKK-Europe to have that much competition to such an extend that the A380 is no longer needed, wow. What are the projections for the coming 5 years for the BKK-Europe or Asia-Europe routes? Can TG make better use of their A380 at a later stage? Can't LHR support a daily A380 flight from TG? TG's first A380 destinations in Europe will be CDG and FRA, is that correct? A388

Quoting TC957 (Reply 12): Perhaps TG should have gone for the HGW 590 tonnes version and re-instate the LAX non-stop, that's only about 300 miles further than QF's MEL-LAX that non-HGW A380's do. There is no 590t MTOW passenger model (that MTOW was for the Freighter). The highest current Weight Variant is 573t and that WV was announced years after TG had placed their order.

Quoting mercure1 (Reply 3): Amazing they ordered and waited 8-years for the aircraft. Yes many things change in a decade. The once bread and butter routes turn moldy. Well basically yes in 8-years the industry landscape and its economics have changed. At least TG is lucky that is sounds like its intra-Asia operations is doing well and and has somewhere to place these aircraft on. Quoting MaverickM11 (Reply 4): I think most carriers are having trouble placing the 380, other than EK. MH certainly will, EU carriers seem to move them all over the place. This is just the beginning. Carriers were having trouble placing their 744s, never mind larger aircraft. ?? Outside of EK, I think the A380 is indeed a niche market machine and will not work for all airlines nor on many routes.' I think we might indeed see folks like Malaysia struggle also over time. Quoting ER757 (Reply 5): I suspect so as well. IMO TG and MH were two "me too" carriers when they ordered this aircraft. Reminds me of the likes of EA, AA, DL and some others back when the 747 frst came out. Yeah, I am old enough to remember that ?? yes I well recall those 747 days also. Not just in the US, but overseas in Europe, Africa, etc many picked up small 747 fleets that economically could not be justified. Quoting Hirnie (Reply 10): When they put them on the routes to FRA and SYD most of the 6 frames will be deployed. It wont be a problem to find regional employment for the rest of the capacity. A FRA route would only require 2 airframes with about 14-hours free time back in BKK to run some regional stuff. SYD I heard would be seasonal so that takes one frames. At the end TG would still have 3.5 - 4.5 frames on a daily basis basically doing short Asia flying. Not sure this is the most ideal deployment of such an expensive aircraft. Quoting Hirnie (Reply 10): Perhaps Thai can gain back some traffic volume over competitive prices and a good new product on the 380. With LH perhaps switching to the 346 to BKK pressure on this route might be a bit decreased. I don't think the issue is traffic volume, but revenue. With SK dropping BKK they did not say loads were an issue, but the lack of yields in the market. Quoting TC957 (Reply 12): Perhaps TG should have gone for the HGW 590 tonnes version and re-instate the LAX non-stop, that's only about 300 miles further than QF's MEL-LAX that non-HGW A380's do. Meanwhile, wonder if Moscow could work for TG 380's, seeing UN use high-density 744's to BKK. I think TG would be well served avoiding trying to dump the A380 to LAX. It already has enough problems here with a checkered history. Also for Moscow, I'm not sure TG really wants to chase after bargain basement Russian tourist. Quoting A388 (Reply 14): I never expected the BKK-Europe to have that much competition to such an extend that the A380 is no longer needed, wow. As I said above, I think the issue is yields. Plumping more capacity into a place like BKK-LHR will only drive it down further.

Quoting A388 (Reply 14): I never expected the BKK-Europe to have that much competition to such an extend that the A380 is no longer needed, wow. What are the projections for the coming 5 years for the BKK-Europe or Asia-Europe routes? Can TG make better use of their A380 at a later stage? Can't LHR support a daily A380 flight from TG? TG's first A380 destinations in Europe will be CDG and FRA, is that correct? You are missing the point here I feel. TG and everyone else knows that there is indeed a huge market between LHR and BKK to support double daily A380s however what TG is trying to emphasize that for this particular market segment the EU pax will not pay any premium what so ever to fly nonstop versus one stop i.e. via IST/DOH/MCT/DXB/AUH/BOM etc. This is why if you check on MIDT or PAXIS, the one stop carriers dominate the CDG-BKK + LHR-BKK market segments and also why BA too has stopped operating double daily B744s to BKK for a while now + AF reducing BKK to 4 weekly B773ERs. In addition also note that with BMI gone, LHR is no longer a major STAR hub and if you fly to EU via LHR, you are back tracking a lot hence TG pax flying to its offline European cities prefer transiting via FRA instead. TG should try and see if it can squeeze out an A380 to operate daily flights using this aircraft type to both PVG and PEK as these two market segments will be able to fill the premium classes in particular with high yielding O&D passengers.

Quoting A388 (Reply 14): I never expected the BKK-Europe to have that much competition to such an extend that the A380 is no longer needed, wow. What are the projections for the coming 5 years for the BKK-Europe or Asia-Europe routes? Can TG make better use of their A380 at a later stage? Can't LHR support a daily A380 flight from TG? TG's first A380 destinations in Europe will be CDG and FRA, is that correct? It's largely down to EK, EY and QR flooding the market with new capacity that didn't exist to that extent when TG ordered their 380s. AF/KL barely hold ground any more in BKK. SK have already announced they will cancel BKK. I question how well OS, LX or LH are doing to BKK as they fly with with rather premium heavy configurations.

I wonder how the A380 will hold up on higher cycle/short stage length utilization over time. Even Mr. Boeing had to come up with structural changes with 747 to accommodate customers with such conditions.

Thanks for the explanations. So this problem is purely a BKK being less competitive issue? Why are airlines such as SQ, CX and maybe even QF still doing well on their routes between Asia/Australia and Europe? A388

Quoting Birdwatching (Reply 11): Could they lease them out? It seems like EK can't wait to get their orders filled. Thai could lease them out to Emirates, but then again, that would probably make the whole problem even worse. That sounds like a good idea, but you're right, as lessor, wouldn't TG still be responsible for them? Also: I was just thinking of routes that TG could operate this on, and I want someone who is better acquainted with TG to tell me how such an A380 route would do: BKK-NRT BKK-PEK BKK-PVG BKK-HKG I'd assume those would be high-density

Quoting Stitch (Reply 7): At the time they ordered it, they needed it. Once they didn't need it, they were not in a position to cancel them so now they have to make use of them where they can. The A380-800 and 777-300ER do give TG a fresh and efficient long-haul fleet, so that will hopefully start to drive up demand and allow the A380-800s room to grow into. It must be costing TG vast sums for that room to grow, plus to avoid tariffs on shrimp. Quoting fcogafa (Reply 9): Ironic that Emirates A380 expansion seems to be killing off the A380 requirement for other airlines. Maybe the world only needs a finite number of A380s, whoever operates them. And this is at a time when UAE only has a quarter of their envisioned fleet.... It's no surprise to many of us.

I say configure 4 regionally, still with lie flat for red eyes but in a denser layout and a real F but not a suite, and 2 for SYD and FRA in full config. Syd-bkk-FRA can be done with two planes six days a week, w a smaller AC the other day, and as long as the regional version has lie flat it can sub for a major tech. The A380 can be an effective regional Asia aircraft if configured right. And that light fuel load frees up cargo density.

Quoting behramjee (Reply 17): In addition also note that with BMI gone, LHR is no longer a major STAR hub and if you fly to EU via LHR, you are back tracking a lot hence TG pax flying to its offline European cities prefer transiting via FRA instead. That is why TG will schedule the A380 into FRA and why it will deploy its brand new 777-300ER to BRU soon. Quoting runway23 (Reply 18): I question how well OS, LX or LH are doing to BKK as they fly with with rather premium heavy configurations. LH has already said that its FRA-BKK service is under review because of falling yields. Quoting A388 (Reply 20): Why are airlines such as SQ, CX and maybe even QF still doing well on their routes between Asia/Australia and Europe? QF has taken the stance that if you can't beat them, then join them. That is why QF is teaming up with EK next April. I don't think CX and SQ have seen much growth in their Europe-Australia traffic. But these airlines are now carrying more people from Europe to Asia (especially mainland China) and the passenger traffic flying from China to Australia via HKG and SIN makes up for any loss in Europe-Australia traffic.

25 avek00: Thai never needed the A380 from the get-go, the order was an act of vanity. The airline's problem is not with catering to capacity, but rather in ext

26 A388: So that will mean that EK will also join QR who is QF's new OneWorld partner? A388

27 behramjee: Please note that EK does actually make a small profit operating to BKK because it gets above average yields + massive cargo + very high S/F in F and J

29 goosebayguy: I can remember trying to book holiday to Thailand back in 2002 only to find there was not a single seat at all during February. Had to go to Malaysia

30 SQ22: And the number will be further increasing with AB offering no more direct flights but instead flights via AUH with an EY bird on the second leg to BK

32 JAAlbert: That's an awful lot of money to spend for something the airline really doesn't need! What does each 380 cost? $300 million? And BKK is too far to fly

33 Flighty: Carriers have had a funny (inexpert) understanding of financial risk. An A380 is a large commitment to fuel and capacity that isn't going to be necess

34 LondonCity: Since its A340-500s were withdrawn from active service a few months ago, TG no longer flies BKK-LAX non-stop.

35 PHX787: I don't know why they just won't use it regionally now until they can find a suitable market for them. NRT seems to be one of those unsung 380 heaven

36 commavia: I think this is pretty much just a microcosm of the phenomenon many were highlighting years ago when they questioned the underlying economic logic of

37 Byrdluvs747: Was the A380 designed for high cycle/short haul operations? Also, if more carriers are struggling to place these behemoths, what effect will it have o

38 behramjee: In 2011, EY operated double daily B77Ws to BKK seating 390 pax on each flight approx so multiply it by 4 legs so total seats on offer daily is 1,560

39 Viscount724: Fleet planning has never been one of TG's strong points. They've operated a few of almost everything built. If they hadn't been so dominated by the g

40 TheSonntag: I flew a Thai 747 FRA-BKK in 2011. I was very disappointed by this plane, worn, old seats, fair service, simply nothing special. IMHO, if they lost ma

41 ACES320: It all depends on the perception. If you check on Thai culture, vanity and assertiveness are values rather not so popular in their culture, politics

42 jfk777: Thai is able to use the A380 on long haul regional routes to Tokyo and Sydney which would be long haul over the Atlantic. Peking is certainly a route

43 jumpjets: The TGs 340-600s have around 110 less pax than a 744 - but what is interesting [to me at least] is that the capacity reduction is all in Y class - ar

44 qf002: I used to make the same argument for SYD, which (until this year) was a 2-3 daily A346, but TG has already announced that we'll be getting their A380

45 HELyes: BKK doesn't look that gloomy to all Europeans. Finnair serves BKK 2x daily in winter and the ticket prices tend to be rather high from HEL, I wish Th

46 brilondon: I don't think that the competition is driving the demand down for the A380 flight, but the poor economy in Europe that has driven demand down that wa

47 tayser: If anything they could drop the midnight 2nd daily (mainly only a few times weekly at the moment - TG462/461) BKK-MEL flight and just upgauge the main

49 kanban: miss print? only an A.netter would relish a flight from BKK to Tokyo via the Atlantic...

50 jfk777: You clearly missed the point, while a Bangkok to tokyo flight in Asia is "regional" its only a few hundred miles shorter then "Atlantic long haul" li

51 qf002: Absolutely agree. My only concern would be the fact that it would mean introducing F back into the market. I'm not sure how much of an issue that wou

53 ordjoe: Thai having a hard time finding some oversized premium heavy plane to use on routes that are heavy with VFR and leisure traffic, STOP THE PRESSES!!!!!

54 AirMailer: I'm guessing he meant that the comprable distance over the Atlantic would be considered a Long-Haul.

56 nethkt: Totally agree. With so much of the 380s, EK is offering sale all year long, plus easy upgrades to Business and First class as seats will always be op

57 Condor24: Very interesting topic. Emirates, and to a lesser extent Etihad & Qatar Airlines are hammering the legacy carriers on the 'Europe to Australia / N

59 sankaps: That is true of the Western hemisphere and the Atlantic for sure. But in the case of Asia-Europe flows and TG, the business case for TG's A380s have

60 IndianicWorld: I do wonder if TG may well look at deploying an A380 into MEL at some stage. Will be interesting to see what role these aircraft play.

62 gipsy: I wonder why nobody until now did use the A380 as high capacity a/c. Would be interesting to see what happened if e.g Thai would put in 700 Y seats an

64 Unflug: Repeating that mantra doesn't make it true. The competition taking away business from Thai is "driving down averate seats per departure and favoring

65 francoflier: I think that when these airlines finalized their orders for the A380, aviation was on a relatively good phase of the cycle with reasonably good forec

66 infinit: Using their A380s for SIN, HKG and one other route, a medium to long haul one, would be interesting. I think its viable in the Asian market. SQ and JL

68 motorhussy: Maybe the A380 will help TG claw back some market share from the Gulf carriers.

69 LondonCity: Maybe. But as has been noted above the market from Europe to Bangkok (the one where the Gulf carriers are doing good business) is mainly leisure-orie

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