Three years of smiles at AVS GSA in Thailand

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Having joined the ECS Group network in 2016, managing director of AVS GSA Thailand, Chirasak Chandratat is delighted with the partnership.

The subsidiary of ECS Group for Thailand is the GSA for 12 online airlines, one offline and in charge of total cargo management for two airlines, Nok Air and NokScoot Airlines. Two more airlines are managed under ECS Group’s Total Cargo Management (TCM) contract, TUI Group and Thomas Cook Airlines in and out of Phuket.

Expressing his delight in joining the ECS family, Chandratat tells Air Cargo Week: “We have been able to contribute and render a high quality of services to all airline customers with our great sales and operations teams. The partnership has been highlighted by seamless service products through the successful and efficient linking of networks under ECS Group.”

As an ECS Group subsidiary, AVS GSA Thailand offers all the services and digital tools developed in-house, with the Thai team offering capacity sales.

Chandratat says: “They are able to offer 24 hours of operational services at both Don Muang International Airport and Bangkok Suvarnabhumi Airport with compliance to all airline’s procedures.”

The team also offer customs formalities, road feeder links between Don Muang and Suvarnabhumi airports. TCM expertise gives customers customised services covering an airline’s every need.

The ECS treatment for NokScoot

One airline that has been enjoying the ECS treatment is NokScoot, the low-cost medium and long-haul joint venture between Nok Air and Scoot, which started doing business with the GSA in January.

Chandratat says both ECS Group and NokScoot have supported each other to meet revenue, tonnage and service quality targets.

He says: “There were some unavoidable circumstances such as the economic down turn in our region, over capacities, fierce rate competition and trade conflict between China and USA that great impact to air transportation but ECS Group has worked very hard to compete. Despite having to overcome these obstacles we are highly satisfied with our team’s performance.”

AVS GSA has co-ordinated with the NokScoot team to receive products requiring special care such as durian, live tropical fish, mangoes, fresh vegetables and diplomatic goods.

Adding that this includes shipments from interline partners, Chandratat says: “The ECS Group network is a real asset. The principal is very happy with our quick development and progress. Eventually, the revenue and transportation weight reveal bigger than recent periods prior to ECS Group joining this Total Cargo Management with NokScoot.”

High quality of service

NokScoot may be a budget carrier, but from a cargo perspective, there is no difference in terms of service it receives.

Chandratat says: “The market rate is the main criteria for customers to choose their carrier and that competitive rates may changes with demand, supply and quality of services during a particular period.”

He adds: “Our main challenge has been how to convince customers to change the airport of loading to Don Muang instead of Suvarnabhumi. More than that, it is linking their network which has limited abilities with our existing network to increase the potential of NokScoot to compete with competing airlines.”

The air cargo market in Thailand has been impacted by the China-US trade tensions, with Thai exports dependent on China’s supply chain seeing a decline. Long holidays in Japan have also affected Thailand’s exports, as it is one of the largest markets for agricultural, electronic and automotive parts. Rates are also low due to overcapacity and the strength of the Thai baht have hit exports.

Chandratat says the decline appears to be slowing and exports are doing well compared to Thailand’s neighbours, and there are still opportunities to expand to markets in the Middle East, Europe and the USA.

He says: “These circumstances have an impact on our business in Thailand. Nonetheless, ECS Group is performing better overall than the trends seen in our industry. Like any other subsidiaries of ECS Group, we pay a great deal of attention to ensuring that we are working on managing costs, in particular cost savings, and optimising revenue.”

US-China trade tension hitting Thailand

With the global economy slowing and no end in sight for the China-US trade conflict, Chandratat does not see growth picking up this year. The stronger baht is also stifling economic expansion.

The second half of the year is the high season for tourism, so airlines are planning to add capacity on routes primarily to Bangkok, Chiang Mai and Phuket.

He says: “This typically causes more space for export from Thailand and an oversupply and hard to develop yield as per the aforementioned reason.”

If the issues are resolved, Chandratat foresees the market picking up, but if not, then exports from Thailand will grow slowly or remain static.

There is good news, he says: “The Thai government is working very hard to encourage export from Thailand for all modes of transportation and all kinds of products either industrial or agriculture goods. This is being done through proposed tax-cuts for companies willing to relocate their production to Thailand.”

For GSSAs, Chandratat says the best opportunities come from new airlines with smaller fleets operating fewer frequencies.

He says: “They may decide not to invest in human resources or other necessities but will consider good representation in a quality GSSA to run their business in Thailand. In this regard, we may conclude that the GSSA business still has good opportunities in the Thailand market environment.”