Phuket Air to shut down

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http://www.bangkokpost.com/Business/31Aug2005_biz01.php

Phuket Air to quit struggle to stay aloft

Four-year battle ends in bad image, lawsuits

BOONSONG KOSITCHOTETHANA

Hit by a spate of bad publicity, a poor public image and soured
overseas business partnerships, Phuket Airlines has decided to make a
soft landing _ ending most scheduled flights, ceasing charter
operations and leasing nearly all of its fleet including the nine
Boeing 747 jumbo jets.

Vikrom Aisiri, founder and president of the privately owned carrier,
said yesterday he would virtually throw in the towel after a four-year
struggle to keep flying in a hostile operating environment made worse
lately by soaring fuel costs.

The frustrated Mr Vikrom, who is also a Thai senator, said the company
was preparing for the "soft landing" to limit further losses and
troubles. He said he looked back on four years of prejudice, negative
perceptions from authorities, the media and even some members of the
public, at home and overseas.

The latest blow came on Monday when the civil aviation authority of
France listed Phuket Airlines among six carriers banned from its
airspace for safety reasons.

Phuket Airlines was forced to suspend its short-lived scheduled
inter-continental flights from Bangkok to Amsterdam and London, after a
series of incidents. The low point came when some passengers claimed
they saw "flames and sparks" from a Boeing 747-200 taxiing for takeoff
after refuelling last April 3 from Sharjah in the United Arab Emirates,
a stopover on the Bangkok-London route.

The airline has now resolved to stop chartering its aircraft, a common
alternative used by airlines to generate cash from otherwise idled
aircraft. That is because of the ongoing bad experience from their
general sales agents (GSA) in South Korea and Bangladesh.

"It's too troublesome. We learned our lessons in a very hard way and
[we] don't want to get involved anymore," Mr Vikrom told the Bangkok
Post.

One of the airline's Boeing 747-300s has been impounded at South
Korea's Incheon International Airport since Aug 10 over disputes
involving the local GSA, the TV Club Travel.

After one dispute was settled, the Incheon District Court ordered the
seizure of the jet as it was about to take off on Aug 19 on a request
by TV Club, which filed a lawsuit claiming $1.2 million in damages from
Phuket Airlines for losses on planned charters from Seoul to Bangkok.
The airline suspended the operation in July after 30 flights, mostly in
June. The last flight was to take place on Aug 10, the day the plane
was first seized.

When Phuket Airlines attempted to fly its plane back to Thailand, the
International Airport Corp, which runs the airport, stopped the flight
until the airline coughed up $230,000 in cash for aircraft support and
service fees including fuel and catering bills that were actually owed
by TV Club Travel.

The second suit has grounded the plane ever since.

In Bangladesh, the airline has continued to try to clear the claims for
"several crores of taka" its local agent owed to the Civil Aviation
Authority of Bangladesh and Bangladesh Biman Airlines for bills
including aircraft handling. (One crore is 10 million taka, equivalent
to about 6.35 million baht.)

Mr Vikrom said he intends to lease all nine Boeing 747-300s _ five in
service and four others undergoing maintenance _ and some of its
smaller aircraft including one Boeing 737 and two S-11 propeller-driven
airliners, to "reputable and reliable" airlines under a so-called "wet
lease" agreement.

A wet lease contract means that Phuket Airlines will supply the
aircraft, along with cockpit officers, cabin crew and airplane
engineers. The aircraft will be repainted in the lessee's livery.

Three of Phuket Airlines' 747s are already under wet lease to Saudia
Airlines, on Middle Eastern routes.

He said Phuket Airlines would "very soon" drop two of its three
domestic services, from Bangkok to Buri Ram and to Mae Sot in Tak
province.

It will retain only its daily flight from Bangkok to Ranong in order to
support his Andaman Club resort business in the southern province.

That would leave Phuket Airlines operating only one scheduled route,
while the airline becomes a fully fledged provider of aircraft and
staff support for other international carriers.

BL.
- --
Brad Littlejohn | Email:
Unix Systems Administrator, |
Web + NewsMaster, BOFH.. Smeghead! | http://www.sbcglobal.net/~tyketto
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"A Guy Called Tyketto" wrote in message
.. .

Phuket Air to quit struggle to stay aloft

Sometimes you just gotta say "Phuket"