Airline News
Sweeping changes at THAI
February 10th 2015
Thailand's military-led government last week approved a restructuring plan for Thai Airways International (THAI) in a bid to restore profitability at the national carrier following six consecutive quarters of operational losses. Read More » The turnaround plan, dubbed the 'THAI Transformation Roadmap’, includes measures to cut operating costs, boost revenue and sell some non-core assets, Kulit Sombatsiri, director general of Thailand’s State Enterprise Policy Office, told The Bangkok Post. However, unlike previously announced, plans for the forced termination of up to a quarter of its 25,000-strong workforce have been shelved, for the time being.
"If we have good discipline in reducing other unnecessary expenditure, then reducing staff overhead will be one of the last factors as a cost-cutting measure. They have worked with us for a long time and if we need to lay off people in our organization, appropriate packages will be offered to them and it will be voluntary," THAI president, Charumporn Jotikasthira, told Thailand’s Nation TV last week. The Thai government is THAI’s primary backer and as such, analysts have predicted that any forced redundancies could have severe political ramifications for the country's military junta currently in power.
Meanwhile, Jotikasthira said THAI was looking at a 10% overall capacity and network reduction in 2014. To this end, The Bangkok Post last week reported that THAI will axe services from Bangkok to Madrid and Moscow, as well as from Phuket to Seoul, effective March 29. A decision on whether to suspend its single service to the U.S., a daily Los Angeles (via Seoul) service, is imminent, the same paper said. Jotikasthira, an ex-president of Thailand’s Stock Exchange, also said that decisions on further route cancellations will be made in the fourth quarter. Routes currently unprofitable but viewed to have potential include: Brisbane, Brussels, Colombo, Denpasar, Hyderabad, Milan, Rome and Sapporo.
THAI will retire 22 aircraft by July, mainly A300s, older A330s, A340-500s and -600s. At the same time, it will continue to take delivery of new A330s, A350s and B787s, Jotikasthira said.
