SIA's NokScoot JV under threat as Thai civil aviation troubles escalate

But Tigerair is a clear winner.

NokScoot, a joint venture between Singapore Airlines subsidiary Scoot and Bangkok-based low-cost carrier Nok Air, is under threat from Thailand's intensifying civil aviation troubles.

The International Civil Aviation Organisation (ICAO) recently issued a safety warning on Thailand's aviation sector after its audit on the country’s civil aviation department showed that it had met only 21 out of the 100 requirements.

According to UOB Kay Hian, this is a major dent to the reputation of Thai carriers and could impact SIA’s NokScoot JV. Tigerair, on the other hand, could be a clear winner as more tourists shy away from Thai carriers.

“Thai carriers could see loads to these regions fall and are thus the clearest losers. Singapore-based carriers, in particular, Tigerair could see increased loads on Thai routes. The region approximates 20% of Tigerair’s capacity. NokScoot, an SIA subsidiary could see its expansion plans delayed given the latest warning. Scoot, which was planning to lease aircraft to the JV could face excess capacity,” stated UOB Kay Hian.