THAILAND: Budget Carriers Drive Thailand's Big Numbers Of Tourists

Passenger at Don Muang airport seeks help at a counter of Thai AirAsia, the market leader in Thailand for budget airlines.

When the refurbished Terminal 2 building reopened at Don Muang airport, north of Bangkok, for the New Year holiday rush, teething problems were expected. Among those causing headaches for Phet Chan-charoen, the airport's general manager, were the crowds waiting at immigration counters during the busiest hours at sunrise and sunset.

But the crush of people highlights a milestone passed by Don Muang in the first half of 2015, when it overtook Malaysia's Kuala Lumpur International Airport as the world's largest low-cost carrier airport by passenger numbers, according to the Sydney-based Centre for Aviation. The airport handled 14.4 million passengers in that period, with 13.4 million traveling on low-cost flights. That compares with 15.7 million budget passengers in the whole of 2014, when Don Muang was the world's 20th busiest LCC airport.

Don Muang's growth spurt has also catapulted it past the busiest LCC airports in Europe and North America -- Spain's Barcelona-El Prat and Las Vegas McCarran International in the U.S. Don Muang has room for further significant growth: the airport currently handles 650 flights a day, but has enough capacity for 950, said Phet.

Much of the growth is due to increased numbers of foreign tourists, particularly from China. But it also reflects the rising use of Thailand's growing LCC fleet by Thai travelers. "Domestic fares have come down, more and more and Thais are flying instead of taking buses or trains," said Brendan Sobie, chief analyst at CAPA.

A glance at the blue screens announcing departures at Terminal 2 bears this out. Travelers can take late afternoon flights from Bangkok to 11 provinces by selecting from 20 budget flights that depart every hour. Routes to second-tier travel destinations, such as Udon Thani, in the northeast, compete for passengers with Phuket, the southern resort island that is the crown jewel of Thai tourism.

These extensive LCC options underlie a Tourism Authority of Thailand plan to promote growth in regions that have not received many travelers. Tourism, which accounts for nearly 10% of Thailand's gross domestic product, is the only industry thriving in an otherwise gloomy economy. In 2015 Thailand attracted a record 29.8 million tourists.

Bangkok, Phuket and Pattaya were ranked as the top three Asian destinations for international travelers, according to the MasterCard Asia Pacific Destination Index 2015. Bangkok attracted 21.9 million visitors, who spent $15.2 billion, followed by Phuket, which saw 9.3 million tourists spending $8 billion, and Pattaya, where 8.1 million visitors spent $3.1 billion.

The concentration of tourism spending has not been lost on travel industry officials, who are looking for ways to expand the tourism footprint to less explored areas. Somkid Jatusripitak, the deputy prime minister, recently outlined plans for a drive designed to "create new destinations through a storyline to encourage travelers to explore new places."

The tourism authority recently hosted a three-day fair in a park at the edge of Bangkok's business district to highlight the attractions of the country's second-tier travel destinations. Visitors posed for pictures with large posters of flowering trees, a mermaid rising from the sea, and the dancing troupes that are seen in the less known parts of the country. These were all part of a "12 Hidden Gems Plus" tourism campaign to encourage travel to 24 relatively unknown destinations.