Nok Air executives are scratching their heads wondering how to use the airline's new Boeing 737 jets in the face of shrinking domestic air travel demand caused by Thailand's worst flooding in 69 years.
The budget airline last Saturday took delivery of the first of 12 leased Boeing 737-800 jets. The plane has since been parked at the Royal Thai Navy-managed U-Tapao Pattaya airport instead of being deployed quickly as planned.
The second 737-800 is due next Friday and the third on Nov 24, joining Nok Air's current fleet of 10 older B737-400s and two ATR 72 turboprops.
"We've yet to decide how to use these early B737-800s," chief executive Patee Sarasin told the Bangkok Post yesterday.
The carrier is facing a short-term capacity surplus due to the market downturn, while relocation of its base from the inundated Don Mueang airport to Suvarnabhumi airport has complicated the issue.
Nok Air earlier planned to have the first B737-800 in service by now on the Bangkok-Chang Mai route.
Specific dates for the nine other B737-800 have yet to be set, but deliveries will be from 2012-13.
The first batch of B737-800s will be used for expansion, while the later deliveries will replace the B737-400s, all of which are leased.
The replacements will markedly increase capacity, as the smaller B737-400s are configured with only 150 seats and have a relatively low utilisation rate, while the B737-800s have 189 seats and are more fuel-efficient.
The airline will gradually return its 10 B737-400s, four of which are leased from Thai Airways International, a 49% stakeholder in Nok Air, from mid-2012 to 2015.
Nok Air has been acquiring second-hand B737-800s as part of its fleet renewal to take advantage of lower maintenance costs, raise its average utilisation to more than 11 hours a day and increase seat capacity.
Nok Air is seeing contrasting passenger traffic flows, with flights leaving Bangkok at near capacity and incoming flights at only 40%.
"We're seeing more people fleeing the flooding in Bangkok than are coming in," said Mr Patee.
Like the authorities, Nok Air is in the dark as to when it can return to its home base at Don Mueang, because when the floodwaters will subside, the extent of damage to the airport and how long it will take to revive airport operations all remain unclear.
"But obviously, it's impossible to go back by Nov 10 like we originally anticipated," said Mr Patee.
"My best guesstimate now is the end of December."
Nok Air's operations at Suvarnabhumi this past week have not been smooth.
Its forced evacuation from Don Mueang has resulted in flight delays, changes in flight times and computer system problems.
"We've had a hard time addressing these issues, but we're getting back to pre-crisis service levels," said Mr Patee.