Thai Airways' new boss seeks tie-ups to counter fuel costs

Fri Nov 2, 2012 8:19am EDT

* Says has asked strategy department to examine potential tie-ups

* Says partnership is one way to offset rising fuel costs

* Says not in talks now with any Gulf carrier

By Marilyn Gerlach

FRANKFURT, Nov 2 (Reuters) - Thai Airways will actively seek partnerships with other airlines to counter surging fuel prices, its new president told Reuters in an interview.

With fuel accounting for a huge chunk of operating expenditure, some carriers have rejigged their alliances, a few of them by partnering with Gulf carriers.

Australia's struggling Qantas Airways clinched a 10-year alliance with Dubai's Emirates in September, while Air France-KLM agreed on a code-share agreement with Etihad and Air Berlin in October.

"Since I took office a few weeks ago, I've been talking to our strategy department about greater partnerships with other airlines because that's the way to go into the future with the fuel prices," Sorajak Kasemsuvan said on the sidelines of an event in Frankfurt late Thursday.

Kasemsuvan, appointed in September, said he planned to talk to as many potential partners as possible, although it was unlikely a deal could be done this year.

"If the fuel prices are like this, you cannot go alone," he said.

Thai said in August it expected to miss its 2012 net profit target of 6 billion Thai baht ($195 million) due to higher fuel costs although revenues were expected to rise by about 3 percent.

Asked if any of the three big Middle Eastern airlines - Etihad Airways, Emirates and Qatar Airways - had approached Thai for possible tie-ups, Kasemsuvan said: "In the past, I think one of them had talked to us, but not right now."

While saying he would be keen to talk to any airline next year, Kasemsuvan said Thai's partners in the Star Alliance would be his priority when seeking partnerships. The 27-member group includes Deutsche Lufthansa AG, Singapore Airlines and United.

"In the past Thai Airways may not have been forceful enough in approaching partnership but I think we'll go for greater partnerships and alliances," Kasemsuvan said.