There are now 10 domestic airlines with 58 planes in total, serving both local and international travellers. The latter has been growing, according to figures from the Department of Civil Aviation (DCA). In 2015, out of two million tourists, only 7 per cent used local airlines. Last year, the number of tourists rose to 2.4 million, with 16 per cent flying local airlines.
This is, however, in stark contrast to the rest of the region, said the Union of Myanmar Travel Association (UMTA). There are some 30 to 40 million travellers visiting Thailand a year, but the kingdom has only six airlines and hundreds of aircrafts, according to Mr Thet Lwin Toe, who chairs the UMTA.
He said that the main barrier is the high price of the flight ticket compared with the rest of Asean (Association of South-east Asian Nations). This is due mainly to the high costs of petrol and maintenance operations, which need to be paid in US dollars, he said. The result is that most airlines are inactive during the rainy season between May and October, when the south-west monsoon winds bring heavy rain to the country.
Mr Thet Lwin Toe said: “During the rainy season, only three out of 10 airlines can run. The main problem for local airlines is that they can’t reduce their air ticket fares.”
He blamed the high price of petrol on the monopolistic conditions in the petrol market. “As far as I know, provision or supply of petrol for airlines is controlled by one or two companies,” he said. “I want an international petrol distribution company to come to Myanmar, so the price will be fairer.”
Aircrafts from other countries that land in Yangon International Airport carry their own petrol because prices in Myanmar are so high. Another reason for the lacklustre market is that airlines are not competitive.
Owners are not operating airlines out of commercial interests but out of personal interests, said Mr Thet Lwin Toe.
“In Myanmar, there were 10 airlines but not enough aircrafts,” he said. “It is crazy. The DCA should set a principle and businessmen should cooperate in the interest of our citizens. But they are stubborn and it deters the process.” The DCA governs the operations of airlines. It has the authority to quash or suspend the Air Operation Certificate.
“In my opinion, airlines should take a step back to think thoroughly why they did not manage to make a profit after three years of operations, and they should consider cooperating with another airline.
“If not, the DCA should take away their Air Operation Certificate. Some companies owned by famous tycoons don’t care about their loss, although they didn’t turn a profit, because the businessmen only care about their dignity and (maintaining) continuous operation.”
DCA’s efforts to ask airlines to consolidate have fallen on deaf ears, as owners prefer to engage in turf warfare in the domestic market rather than work together to expand it.
As Mr Ye Hut Aung, deputy director general of the DCA, has observed, the DCA and the Ministry of Transport and Communication have always encouraged partnerships. But no new airline had applied to do so.
This tendency to protect one’s turf has led to airlines buying small aircraft that seat fewer than 100 people instead of investing in bigger aircraft that are more efficient in tapping into the growing number of tourists seeking to holiday in Myanmar.
For example, Mann Yadanarpon Airlines boasts of having French-made ATR-72-600 aircraft that can carry 70 passengers just to cover 13 townships around the country – even as it blames the government for not building bigger and better airports for aircraft such as Airbus, which can carry 100 to 200 passengers.
“We have intense market competition among airlines. We want the government to reduce the petrol price and upgrade the airport infrastructure and facilities, making them in line with international standards,” said Ms Witt Ye Maw, marketing manager of Mann Yadanarpon Airlines.
The lack of infrastructural development is the reason why airlines “have difficulties” during the high season of visitors, said Ms Ma Aye Mra Tha, the assistant general manager of Air KBZ. Her company runs eight brand new ATR aircrafts, which is the type most airports in Myanmar can cater to.
At the moment, Myanmar only has three airports where Airbuses can land. The rest of the airports still need to be upgraded by the government in order to do so.
She noted that the new government has only been in office for one year, so it needs time to work on airport development.
She also pointed out that if Myanmar develops and more people come to Myanmar, airline operators will be able to maintain flight services the whole year round.
“For now, the number of both domestic and international visitors is not enough to sustain the services during the low season,” she added.
Local airlines have many challenges during the rainy season every year because tourists tend to avoid the rainy season. Thus, airlines are used to operate via a code-sharing agreement with other airlines, while offering promotions with discounted fares to some destinations in Myanmar.
A code-sharing agreement is an aviation commercial arrangement where two or more airlines agree to list certain flights in a reservation system under each other’s names.
For example, to encourage more demand in the domestic air travel sector, the government is arranging an initiative – “green season” – to promote local airlines and attract tourists who want to come to Myanmar during the rainy season.
“Rainy season is good to travel … Tourists can see Myanmar from a different point of view,” said Ms Ma Aye Mra Tha.
“In rainy season, some regions are nice to visit … We (at Air KBZ) and Myanmar Airways International are in cooperation and have so many agents in other countries selling tickets and promoting Myanmar as a travel destination,” she added.
Yadanarpon Airlines to expand
13 June 2016: Mann Yadanarpon Airlines plans to expand its fleet and open new routes on Thailand next year.
The airline marketing manager, Wutyi Maw, told TTR Weekly at the Thailand Travel Mart Plus 2016, held last week in Chiang Mai, that the airline would add two more aircraft to serve destinations in Thailand.
“Currently, we have two ATR72-600s operating just domestic routes…to increase our airline network we plan to add more two more ATR72s next year.”
Hosting the event in Chiang Mai gave the marketing team a chance to see first-hand what Chiang Mai has to offer, she said.
“The feedback this year is good as we met many buyers…it might be good to move the event around Thailand to offer various choice for buyers to get a wider picture of what the country has to offer… Phuket and Ranong for example are close to Myanmar, so we can in the long-run benefit from a travel boom to Phuket.”
The Mandalay- based airline currently operates services to Yangon, Bagan, Nay Pyi Taw, Heho, Lashio, Tachileik, Kyaing Tong, Thandwe, Sittwe, Myitkyina, Dawei, Myeik and Kawthaung.