Key Takeaways
- Multiple aviation fee hikes in Thailand could increase travel costs for tourists
- Airlines face thin 1.9% profit margins in Asia-Pacific region
- Foreign arrivals have contracted by 7% year-on-year in 2025
- IATA calls for better coordination to prevent industry burden
Rising aviation service fees in Thailand threaten to derail tourism recovery as airlines struggle with thin profit margins, according to the International Air Transport Association (IATA). The proposed charges include a 300-baht tourism tax, increased passenger service charges, and higher international travel fees.
Multiple Fee Increases Planned
Sheldon Hee, IATA’s regional vice-president for Asia-Pacific, confirmed Thailand is considering several aviation charge increases this year and beyond. These include:
- The 300-baht tourism tax implementation
- AOT’s plan to raise passenger service charges from 730 baht per person
- CAAT’s proposal to increase international travel charges from 15 baht per person
- Higher air navigation charges from Aeronautical Radio of Thailand Ltd
- Increased overtime aircraft inspection fees from the Immigration Bureau
Tourism Already Showing Weakness
“These charges could potentially increase costs for passengers visiting Thailand at a time when tourism seems to be weakening,” said Mr Hee. Foreign arrivals to Thailand in 2025 total more than 25 million thus far, contracting over 7% year-on-year.
Airline profits remain critically low, with IATA forecasting a net margin of only 1.9% in Asia-Pacific this year – equivalent to just $2.6 per passenger. The additional charges could be passed directly to travelers or burden airline operations, making sustainable expansion difficult.
Balancing Volume and Revenue
While Thailand has historically attracted price-sensitive leisure tourists, the government now aims to target premium travelers. Mr Hee emphasized that restoring tourism to pre-pandemic levels requires balancing volume and revenue.
IATA advocates for stronger coordination between stakeholders and airlines to prevent immediate industry burden. The association notes commercial aviation faces a record backlog of over 17,000 jets in 2024, meaning new aircraft deliveries may extend into the 2030s.
Contrasting Developments
Despite the fee concerns, positive developments include:
August data shows Asia-Pacific airlines’ international passenger demand grew 9.8% year-on-year with 85.1% load factor.
Deputy Prime Minister Thamanat Prompow recently committed to negotiating reduced landing and parking fees at AOT’s six airports to boost international flights.
The Tourism Authority of Thailand expects 80 new international routes in Q4 from Asia, Middle East, Europe, and the US. The “Thailand Summer Blast” stimulus should bring 731 chartered flights from China and Macau.
Regarding CAAT’s plan to eliminate aircraft age limits to ease shortages, Mr Hee confirmed age alone shouldn’t raise safety concerns if maintenance meets international standards.
