This year’s IATA Ground Handling Conference is to be hosted by flag carrier Thai Airways International. AGS caught up with Usanee Sansingken, CEO and acting president at the airline, to find out what’s new there.
Thai and Thai Smile’s combined route network covers 11 domestic destinations (excluding Bangkok). The carriers also fly to 52 destinations in 20 Asia-Pacific countries, and to 17 destinations in 12 countries on intercontinental routes.
As at 31 March 2017, Thai Airways and its sister carrier Thai Smile Airways owned a fleet of 95 aircraft, consisting of 38 long-haul aircraft, 35 medium-range aircraft and 22 narrow-body short-haul aircraft including B737-400 and A320-200.
The company will take delivery of five A350-900s in the latter half of 2017 and five more in 2018. These new aircraft will replace two A330-300s and five B747-400s, which will be phased out of the fleet over the next couple of years. In 2018 Thai’s fleet will consist of 100 aircraft altogether and will remain so until 2021.
Thai is also the biggest ground service provider in Thailand, and is known as TG Ground Services (TGGS). TGGS provides full services including line maintenance for ground support equipment for Thai and other customer airlines at Bangkok and other domestic stations. It is investing in new ground support equipment to improve ramp services across its domestic network.
TGGS has the biggest cargo terminal space in Bangkok (90,000m2), Phuket (1,800m2) and Chiangmai (2,000m2). It is expanding its cargo terminal network to cover other airports in Thailand such as Hat Yai, Chiangrai, Surat Thani and Krabi. It currently serves 70 customer airlines.
Finally, TGGS delivers in-flight catering for both domestic and international flights for 60 customer airlines, and delivers on-the-ground catering services too. Recently, it received the Skytrax Best Economy Class Airline Catering 2016 award.
Q. TGGS offers a pretty comprehensive range of services – presumably you self-handle at your home hub?
Yes, we do our self-handling at our home base in Thailand and handle for our customer airlines’ flights, both in Bangkok and domestic stations, together with our 100% owned subsidiary company WingSpan. With this strategy, we can manage costs efficiently. Furthermore, we can better control many aspects of manpower. We are able to develop new young people, to have Thai standards, which greatly satisfy our customers. The shortage of personnel is at minimum to none. In some operations, our company provides outsourcing or out-job in order to achieve a complete supply chain.
Q. What about elsewhere – what is your approach to handling at locations besides Bangkok?
We do self-handling services outside Thailand only at KTM (Tribhuvan International airport in Kathmandu). At other stations abroad we use various GHAs depending on factors such as choice or availability of providers at each location, service provision and competitive/reasonable prices. Pricewise, we operate under a global deal for some locations such as in Australia (at Sydney, Melbourne, Brisbane and Perth). We expect to expand this concept to other locations in Europe and Asia.
As one of the ground services providers at locations within Thailand, TGGS is also looking for a potential opportunity to expand its ground handling business abroad in the future.
Q. Returning to your home base, what do you see as the biggest challenges there?
From a ground handler’s perspective, the main challenges are severe competition in pricing, financial management and cost control and service expectation from airline customers.
Our challenges are how we have to manage and control costs that are not stable; that is manpower, use of ground service equipment and so on. It is necessary to have people who can multi-task. Just like any other industry, the airline industry needs to attract potential employees with good benefits and a good career path as well as job security. Definitely, we have to balance all of this with our cost control in order to keep our people with us. People are always the valued resource to maintain our standards.
For financial management and cost control, one of the most important projects in our company is to review cost reduction at every operations unit without affecting quality of service. The cargo and mail department has performed very well on this when they launched Cargo Lean Management: under this programme, they can shorten working time, decrease damage claim, increase safety and security, create new service solutions, increase efficiency and, finally, increase customer satisfaction. The catering department has been successful in reducing imported raw material by buying more locally. Their actions support what the Thai government calls for. Another example is we are using consultant services for passenger and ramp areas of the business.
Next, service expectation: we understand our airline customers can save costs by using full ground handling services. They can also conveniently monitor our services at headquarters. We have introduced several new technologies to support operations such as on-line check-in, kiosk check-in, highly efficient systems/equipment, etc to avoid manpower shortages and/or to reduce time-consuming processes as well as controlling costs whilst enhancing convenience and satisfaction for our customers. Our long-term plan is to look for an effective partnership project with the Thai group in order to synergise the Three Brand Strategy (Thai Airways, Thai Smile Airways and Nok Air) so we can cover all customer sectors.
Q. There were concerns over aviation safety in Thailand a couple of years ago; what practical steps has Thai Airways taken to improve safety?
In May 2015, Thai Airways management launched a new policy to align the airline to EASA standards to ensure a world-class airline management system. An upgrade to meet with the EASA Part ORO (Organization Requirements for Air Operations) was completed in September 2015 along with the EASA-based Organization Management Manual (OMM), specifically called THAI Integrated Management Manual (TiMM). The newly drafted EASA-based OM-A and OM-D were produced on 31 October 2015. Workshops and trainings on the new compliance culture and EASA standard for senior management, managers and staff were also completed.
Implementation of a new safety and compliance management tool, namely the Integrated Quality and Safety Management System (IQSMS) began on 16 November 2015. The complete cutover date from the former in-house developed Air Safety Reporting program to this Company Safety Information System (CSIS) tool will coincide with Thai’s 57-year anniversary, namely 1 May 2017.
A joint collaboration between Scandinavian Airline Systems (SAS) and Thai in the implementation of a safety performance monitoring and analysis platform named ENPLORE began on 4 January 2016 and was fully implemented on both airlines on 7 December 2016, expanding to three more Star Alliance carriers with the prospect of adoption by the whole alliance if found effective. This platform doesn’t only provide real-time SPIs (service provider interfaces) but also combines the correlation of SPIs to predict the likelihood of safety events such as the European Aviation Safety Agency ‘Significant 7’ to give airlines a chance to intervene before such mishaps occur.
Q. More generally, how is Thailand’s aviation industry developing?
The number of tourists is growing because of the government policy to promote Thailand’s tourism, with floods of tourists coming from China and all over the world. Air transportation has become easier and more popular. Tourists can choose among various airlines to fly from/to Thailand. Low-cost carriers (LCCs) have definitely come in and taken some market share from the premium airlines. The trend of this industry depends on several factors. Customers come with more expectations, and they are more cost conscious than ever. Therefore, the airline business is much more aggressive. In order to compete with LCCs, premium airlines raise their standards to a higher level for both service quality and safety.
TGGS has to customise its services in order to serve its various customer airlines. For example, LCCs need less ground time, services for narrow-bodied aircraft, less baggage allowance and so on while legacy airlines need full premium services. Besides this, Thailand is obviously attractive for Chinese tourists, so we do focus on our staff’s potential for second language skills as well.
At Bangkok Suvarnabhumi airport (BKK), the Airport Authority of Thailand (AOT) will expand Midfield, Terminal 2 within five years, to serve the growth of the industry. AOT also launched a Passenger Baggage Reconciliation System (PBRS) on January 1, 2017.