Small size, but big ambitions for Lao Airlines

Lao Airlines – the government-owned, national airline of Laos – is planning to build up its small cargo operation incrementally despite financial, facility and equipment limitations. Michael Mackey reports from Vientiane.

The carrier operates domestic services to ten destinations and international services to Cambodia, China, Thailand, Vietnam and Singapore. Headquartered at Wattay Airport in the Laotian capital Vientiane, Lao Airlines’s cargo operations are limited by the small size of the homebase economy and the dominant role wellestablished carriers such as Thai have in that market. Tellingly Wattay is the only airport in the country to have any cargo facilities. There are airports at Luang Prabang, Pakse and Savannakhet but these, as well as being built around passengers, offer only internal flights. “Inbound is very heavy and outbound is small,” said Thongsamouth Srioudom, duty manager of Lao Airlines Cargo Department. Imports are largely electronic and textiles from Malaysia with high quality Laos silk also being a big part of the exports. Some statistics from Lao Airlines underscore these points, as well as making a further one – it might be a small market, but it is a persistent one. In 2005 Lao moved 1.63 million kilograms of freight and just over quarter of a million kilograms of post and mail. Last year those figures were 1.77 million kgs of freight and 274,000 kgs of post. Till September this year they were 1.38 million kgs of freight and 142,000 kgs of post. Another non-Lao source pointed out another reason why the market is limited. “The planes outbound are small and mostly go via Bangkok. There is no capacity out of Laos. All flights are on baby planes with a maximum capacity of one tonne.” But the carrier is gradually upsizing its fleet and in addition to its current fleet of ATR 72 and Chinese-made Xian MA60 aircraft, the carrier recently took delivery of in November 2011, of the first of two Airbus A320s. The second A320 is scheduled to arrive in December 2011, both of which will help boost the carriers cargo carrying ability. Despite the challenges Lao Airlines is not throwing in the towel and hopes the plans to expand the airport’s connectivity with flights to destinations such as Hong Kong, Guangzhou, Incheon and Rangoon will bring it new business. It also hopes to increase the services it offers with plans for a cool room. “Some customers need to send perishables like mushrooms, vegetables” said Thongsamouth. “This year I will submit to build a room….I think it’s a necessity for us to have a cool room.”