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Finnair’s Silk Road from Helsinki to Asia
By John Lindgren
The 83-year old Helsinki based Finnair (IATA code AY) is today ranking third
in passenger numbers Europe to Asia after the big players Lufthansa and Air
France/KLM and ahead of number four the global British Airways.
 Finnair
will soon add the former British colony to its successful Asia expansion.
Regular thrice a week flights from Finland to India – from Helsinki to Delhi
would have been unrealistic, let’s say five years ago. But from October 30,
2006 Finland’s flag carrier starts nonstop flights from Hel to Del – adding
one more important Asia destination to its long haul routes. Finnair already
flies more than twice a day to China and daily to Bangkok and Japan.
Asia was one of the key topics during a recent interview
with Christer Haglund, senior vice president corporate communications
Finnair in Helsinki recently. “A key part of Finnair’s Asia strategy is
Helsinki’s geophysical position; closer to the North Pole than the Equator.
Closer to Asia than Europe. The Asian Gateway. And Helsinki is unique as a
link between East and West Europe, explains Christer Haglund. “Our Asia
market share has grown 30 percent the last two years. Our balance sheet is
strong and we are one of the few debt-free airline companies with over 9,000
employees. Our passenger load factor was 73 percent last year.”
In 2005 Finnair flew 708,000 passengers to Asia and 70 percent of their
passengers are non Finnish nationals. Even the Swedish government has a
contract with Finnair to handle their Asia flights, according to Haglund.
The struggling Pan Scandinavian flag carrier Scandinavian Airlines System
(SAS) has a modest 10 percent growth on its Asia sector, partly due its
geographically unfavorable hub Copenhagen.
Currently Finnair flies to China (Beijing, Guangzhou, Hong Kong, and
Shanghai), Japan (Osaka and Tokyo), Singapore, and of course Bangkok, a most
important Asia hub for Finnair, explains Christer Haglund. On the 28th of
September Finnair will move its operations to Bangkok’s brand new
Suvarnabhumi International Airport.
Finnair’s significant Asia expansion started with scheduled Helsinki-Bangkok
flights some twenty years ago followed by Singapore, which resulted in a
rather unique advertising campaign: From Sin to Hel fly Finnair.
Today, Finnair flies daily Helsinki to Singapore via Bangkok and vice versa.
Due to high demand from both leisure and business travelers they will
increase their Helsinki flights from 7 flights a week to 13 flights a week
starting December 4, says Finnair’s sales and marketing manager Thailand and
Asia Pacific, Markku Oravainen. “End of the year we will also introduce the
new fuel efficient Airbus 340 to replace our current MD-11’s on this
sector.”
“And we will continue to look East,” says Haglund. In May 2007 Finnair will
open another new South-East Asian route when flights from Helsinki to Kuala
Lumpur, the capital of Malaysia commence with three flights a week via
Bangkok. This will bring the total number of Finnair flights to Asia from
eight flights to ten.
Markku Remes, Finnair product manager, intercontinental routes says, “We are
now negotiating landing rights in Seoul, Korea and Ho Chi Minh City (Saigon)
in Vietnam. Finnish companies have had a strong presence in Vietnam for the
last twenty years,” explained Markku Remes. “Thanks to our excellent
geographical location and our super short transfer times (approximately 35
minutes from gate to gate – from intercontinental to inter European
flights). This is what makes Helsinki International Airport Vantaa and
Finnair the fastest and most direct connection between Europe and Asia. This
is our long haul strategy. The eastern traffic the new Silk Road,” concludes
Christer Haglund.
Retail MOU may require new government
Signing a memorandum of understanding (MoU) to end a row
between foreign-owned mega-retailers and small local businesses may require
waiting for a new government, a Ministry of Commerce source said last Saturday.
According to a Commerce Ministry source, Permanent Secretary Karun Kittisataporn
in his capacity as acting commerce minister may delay signing the MoU because
the policy is that of the government ousted in last week’s coup d’etat.
It is believed to be preferable to wait for the new government, which can then
draft a new retail business law.
The MoU was scheduled to be signed last Friday but representatives of the
mega-retailers did not appear.
The Commerce Ministry had negotiated with the superstore owners according to the
priorities and objectives of the former government which wanted to curb branch
expansions of the major retailers.
Local small retailers claim that the mega-operators opening ‘convenience store’
sized branches in their communities could hurt them because the small businesses
are not financially strong enough to compete against the big players. (TNA)
“Suvarnabhumi Cash Card” to make traveling easier
Siam Commercial Bank (SCB) and King Power Group, the largest
operator of duty free and tax free in Thailand, plan to launch the “Suvarnabhumi
Cash Card” to facilitate purchases made at the new airport.
Julajit Boonyaket, King Power Group vice president said the card is mainly aimed
at helping foreign travelers.
There will be two types of cards: the purple cash card worth 3,000 baht and the
limited gold card worth 50,000 baht.
If the full amount is not used, people can either save the card for future use
or be reimbursed for the remaining credit. The cards are on sale from September
28.
As a special incentive, the first 10,000 people who buy the card will get an
additional 10 percent credit, which means purple card buyers will get 3,300 baht
for a 3,000 baht card and gold card buyers get 55,000 baht for a 50,000 baht
card.
All cards are valid for three years. Gold members will also receive VIP
membership to King Power. - (TNA)
PTTEP ponders Nigerian
oil concession bid
PTTEP, the exploration arm of Thailand’s national energy
conglomerate PTT Plc., is set to bid for oil exploration licensing in Nigeria
and may form a joint venture with other foreign oil firms, a senior PTTEP
executive said last Sunday.
In what is being billed as one of the biggest bids for Nigerian oil exploration
licenses, PTTEP executive Pairoj Raengphonsamrit said the Thai company is
studying the terms of the deal and evaluating political risks in the African
country.
Nigeria, a country with both potential and proven oil reserves is now ranked the
world’s sixth largest oil exporter, capable of producing 3.5 million barrels of
crude oil per day. The country still holds up to 35,900 million barrels of oil
reserve.
Mr. Pairoj said PTTEP has been doing serious research for quite some time into
the potential deal and it wants to join the next round of license bidding
scheduled to take place next year.
In order to hedge the risk, PTTEP is also considering forming a partnership with
other foreign oil exploration firms from Australia, Japan, Chile or even Nigeria
itself.
Meanwhile, PTTEP’s exploration of the Oman 44 oil field in the Persian Gulf may
become operational next month and produce as much as 40 million cubic feet of
oil per day. This will be PTTEP’s first project outside Asia to be successfully
implemented. (TNA)
THAI hell-bent on ending Galileo’s domestic contract
THAI Airways International has given Galileo an ultimatum
on the two parties’ dispute over the national carrier’s decision to
terminate its domestic contract with Galileo: “muzzle your lawyers or lose
the airline’s international business”.
 Wallop
Bhukkanasut: “We have the switch, and we can turn it off.”
In an interview with TTG Daily News, THAI executive vice-president
commercial, Mr Wallop Bhukkanasut, said: “This is only domestic ticketing.
We have a bigger contract with Galileo that covers the world, and that
contract can be terminated without any conditions. It’s a matter of trading.
If they want to trade the domestic portion, which is so little, for the
global portion, which is so big, then so be it. We have the switch, and we
can turn it off.”
Mr. Wallop said management from both companies would likely meet before the
end of the month, but he stressed domestic ticketing “was off the table”.
THAI and Galileo signed a five-year contract in June last year for Galileo
to provide ticketing of the carrier’s domestic flights. THAI also uses
Galileo’s global distribution systems.
Along with cutting costs, the THAI board moved to end the Galileo deal
(effective September 30) because the airline’s previous management entered
into the agreement despite the carrier earlier inking a deal that gave
Thai-Amadeus South-east Asia exclusive rights to issue domestic tickets on
THAI’s behalf.
Mr. Wallop said: “We ended up finding out that our domestic booking fees had
gone up more than 100 per cent. So that’s number one. Number two, we already
had an agreement prior to the Galileo deal, and the other party
(Thai-Amadeus) apparently felt we didn’t live up to the contract, so of
course revenue reimbursement according to that contract was basically
terminated. So we lost on both sides: we lost on revenue generation and we
lost on higher booking costs.” (TTG)
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