After Malindo, its first foreign subsidiary set in Malaysia, low cost carrier Lion Air is now turning its interest towards Thailand with another subsidiary Thai Lion Air.
BANGKOK - Thailand Civil Aviation recently confirmed plans to the daily Bangkok Post that Lion Air, Indonesia’s largest carrier, was finalizing the opening of a new subsidiary at Bangkok Don Mueang airport in Thailand. The future Thai Lion Air would have initially a fleet of six Boeing 737-800. The news was announced by Woradej Harnpraseet, Director General of the Civil Aviation Department. Thai Lion Air started to recruit pilots, cabin attendants and ground staff but the future carrier did not received yet an application for an air operator’s certificate.
Like in the case of Thai AirAsia, Lion Air must have a Thai partner to create the new entity. By law, any foreign company must go through a joint venture with a thai partner owning at least 51% of the share. Some experts suggested that the defunct Phuket Air could be involved but the shaky reputation of the carrier who had a string of incidents would probably not be the best asset for the future Thai Lion Air.
“Lion Air’s entry is good for more healthy competition, giving passengers choice,” said Mr Woradej to the Bangkok Post, noting that Thai skies are open to airlines as long as they meet regulations. Thai Lion Air would operate domestic and regional flights, including to key cities in both Indonesia and Malaysia.
While 122 Boeing B737-900ERs expected to be delivered, Lion Air is looking to expand outside its Indonesian base. Despite promising growth in Indonesia, the saturation of the air space in the country makes the Indonesian carrier looking at venturing abroad. A spokesman for the airline recently stated “we cannot put that many airplanes in Indonesia alone”.
The airline reported to have reached an agreement to acquire 49% of an unnamed Australian company and base six aircraft in Australia – one more aircraft than Tiger Airways’ start-up fleet in Australia. A base still needs to be announced. The airline is mulling also options to set a foot in Vietnam, Bangladesh, Myanmar and the Philippines.
Lion Air recently launched domestic carrier Malindo Air as a joint venture in which it owns a 49% stake and is planning to set up full service carrier Batik Air in Indonesia later this year.
In Malaysia, Malindo air is currently serving ten airports on domestic routes. The carrier has announced to launch flights between Kuala Lumpur and New Delhi in June and serve China as well as Hong Kong out of Kuching and/or Kota Kinabalu in East Malaysia.