Sunday, September 16, 2007

Thailand's air disaster CEO to rethink strategy after tragedy

Udom may have to rethink One-Two-Go strategies

Soon as he learnt about a crash of his One-Two-Go airline on Sunday, Udom Tantiprasongchai, founder and also chief executive officer of Orient Thai Airlines, came out to express his regret over the tragedy.

Udom may have to rethink One-Two-Go strategies


Speaking on television, he extended his condolences to the victims and their families and promised to take care of them. It was quite rare for Udom to come out in the public. For throughout most of his business life, he prefers to shun publicity.

Following the Thai government's implementation of an open sky policy, Udom began to set up his Orient Thai Airlines, a boutique airline company that sought to carve out its niche market.

Orient Thai Airlines relies on Bangkok as a hub, operating charter and scheduled services in Southeast Asia. Its main base is Don Muang International Airport.

Udom is known that closed to military people both in Thailand and Cambodia so that he can run the business well. He also has a regional outlook.

Yet it was off to a rocky start. The airline was formerly known as Cambodian International Airlines. Udom had close ties with the Cambodian authorities. With business problems, Orient Thai ceased scheduled operations on January 9, 1998. But it continues to operate charter services on behalf of Kampuchea Airlines.

However, scheduled operations have since been restarted. It is now wholly owned by private Thai shareholders and has 820 employees (at March 2007).

Three years ago, Udom came up an idea to set up a budget airline based in Bangkok. He eventually set up a wholly owned OneTwoGo Airlines as the proliferation of the budget airlines was fully in vogue. Orient Thai also has a 49 per cent stake in Kampuchea Airlines.

As of September 2007, the OneTwoGO Airlines fleet consists of aircraft 3 Boeing 747100, 1 Boeing 747200, 3 Boeing 747300, 6 McDonnell Douglas MD82 and 1 McDonnell Douglas MD83.

Udom has gone into the airline business because he forsees bright opportunities in the commercial aviation industry.

One Two Go was the first local low cost airline, started the operation between Bangkok to Chiang Mai in 2003. The airline operated as no frill airline ahead of Thai AirAsia.

However, it has not been as successful as Thai AirAsia.

A Phuket bound plane crashed at Phuket international airport amid heavy rain after flying from Bangkok on a budget flight. The aircraft is believed to be a MacDonnel Douglas MD 80 aircraft.

The airline is operating from Bangkok ( Don Mueang International Airport) base Bangkok ( Suvarnabhumi Airport) to Chiang Mai, Chiang Rai, Hat Yai, Krabi, Nakhon Si Thammarat, Phuket and Surat Thani.

Udom has also managed to penetrate into the charter flight and establish business contacts with other international airlines. Orient Thai Airlines was Asia's first international charter operator. Along with its subsidiary, Kampuchea Airlines, it provided services to other airlines including Finnair, Lufthansa, LTU and Merpati.

Udom's niche market was the business with the United Nations. Orient Thai Airlines transported refugees around the world for the UN's International Organization for Migration (IOM), including returning people to Kosovo from Australia and helping Timorese return to East Timor in 1999 after it won its independence from Indonesia.

Orient Thai became a designated UN carrier, transporting troops for peacekeeping operations worldwide.

Orient Thai aircraft also fly Muslim Hajj pilgrims to Saudi Arabia for various clients, including Air India and the Saudi royal family. At the peak of its charter work Orient Thai Airlines' subsidiary operated eight Boeing 747s and seven McDonnell Douglas MD80s aircraft.

As of May 2007, Orient Thai Airlines operates scheduled passenger flights to the following destinations of China, Hong Kong, South Korea.

It is too early to say how Udom might want to restructure his OneToGo airline after the Phuket tragedy. To restore its name, the airline needs to disclose all the facts behind the crash and assure further safety measures.

by Suchart Sritama

The Nation

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