Thai AirAsia Co Ltd (TAA) intends to merge with another low cost carrier to fight price wars because of the COVID-19 pandemic which has had a serious impact on the aviation sector.

TAA President, Tassapon Bijleveld said that the company would start laying down its staff, downsizing its company and its fleet to keep business alive if tourism activities had not resumed into the country by July.

Tassapon said that he had already discussed the possibility of a merger with other airlines. But the details were not revealed.

"A merger is possible if aviation in Thailand resumes with the same old fiery price wars, as now we have more limited revenue sources," he said.

He said air fares will cost between 1,200 Baht and 1,400 Baht to prevent losses for each flight, rising 15 to 20% from the normal rate of about 1,000 Baht (100 Baht = RM13,67).

Tassapon is also the President of the Asia Aviation Plc (AAV) Corporate Executive Board of The Stock Exchange of Thailand. It is the owner of the TAA and has a 40.52 percent stake in AAV.

Tassapon said domestic air services had resumed domestic this month, but due to the lack of leisure tourists the load factors had plummeted.

“We expect a better performance after the second quarter,” he said, adding that international guests were expected to return in October starting with the Asian market.

There are seven low-cost carriers in Thailand. 

In Tassapon’s view, three operators are sufficient for the competition in the market.

TAA said that during the COVID-19 lockdown its 60 aircraft fleet was stranded at airports was around 1.2 billion bht per month.