CAA is likely to break Bangkok Airways monopoly in Siem Reap

Cambodia Angkor Air: all smiles before fighting Siem Reap-Bangkok air monopoly /Photo by L. Citrinot

via CAAI

By Luc Citrinot, eTN | Jan 26, 2011

PHNOM PENH (eTN) - It was a funny coincidence. During the last ATF in Phnom Penh, official lunches hosted for buyers' media were offered by two regional carriers: Cambodia Angkor Air (CAA), Cambodia’s newly-established national carrier, and Bangkok Airways, a pioneer of air transport in the kingdom. Thailand's regional private carrier was the first to launch flights in the early nineties from Bangkok to Phnom Penh and then Siem Reap/Angkor.

Similar presentations, similar entertainment programs were on the menu of both carriers. A way maybe to seduce travel professionals as both carriers are soon to compete on one of Asia’s most desirable routes: Bangkok-Siem Reap. In 1997, Cambodian Prime Minister Hun Sen declared that traffic rights on this route were only given to a Cambodian carrier and Bangkok Airways. Since then, Cambodia Civil Aviation systematically rejected demands from other Thai air carriers such as Thai Airways or Thai AirAsia to compete on this route. With such a decision, it was all smiles for years at Bangkok Airways while individual travelers and tourism trade winced at the high level of charged fares - in vain.

Looking at airline websites gives a better idea of the fare situation. By booking a return flight today (January 26) on Bangkok-Siem Reap (travel dates 4/02 to 6/02), Bangkok Airways’ cheapest fare comes at US$361 (THB 10,850), including taxes. This fare level can be compared to some of the prices on offer by low-cost players out of Bangkok. For a similar – or even cheaper - fare, passengers can go today to Bali or to Macau. And what about Vietnam Airlines’ policy? For a booking on January 26 for the same travel dates, Vietnam’s national carrier – which also enjoys a monopoly on routes to Vietnam - proposes its Siem Reap-Ho Chi Minh City at US$298, including taxes and fees. And it is even cheaper if the flight is done in conjunction with a long-haul connection.

Bangkok Airways’ juicy monopoly might soon be in tatters as competition is due to come. During an exclusive talk to eTurboNews, CAA Vice-CEO Kao Lim confirmed that it seriously looks at opening flights between Siem Reap and Bangkok. “We are now waiting the delivery of two Airbus A321 to expand our international operations. We have plans to start new flights possibly to Japan, Korea, Guangzhou, Singapore, and Thailand. Bangkok-Siem Reap is definitely an option, despite the fact that the route has not been doing that well over the last years,” he explained. New aircraft are due for delivery from April. “We are looking to have a total fleet of five aircraft for the time being,” added Mr. Lim.

For years, Siem Reap-Bangkok stood as Siem Reap’s busiest route. But annual passengers traffic has remained stagnant for almost a decade, hanging approximately around 285,000. During the same time, Siem Reap-Ho Chi Minh City became the airport’s busiest route, now representing over 310,000 passengers a year. CAA management estimates that the combined effects of Thailand’s political crisis and high fares have depressed the air market. And Mr. Lim is already promising that he will seriously look at the price issue when launching its Bangkok-Siem Reap route.