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Transport Secretary Thaworn fears Thailand's ailing national airline, Thai Airways International (THAI), is heading for a record loss of more than 10 billion baht this year.
The financial recovery plan introduced last year is not making any headway. In the first half of the year, a loss of 6 billion baht has already been recorded. The airline's financial position is very critical and Thaworn wonders if the chairman of the board is aware of the seriousness of the situation.
In addition, he is disturbed by the fact that little haste is being done with the recovery plans. The State Secretary wants to pull THAI out of the doldrums, but seems to be bound hand and foot. For example, he cannot fire poorly performing board members. He warns the airline about the plan to hold hands with the government again. THAI wants a loan of 50,8 billion baht for liquidity improvement.
The request for a loan has already been submitted to the Ministry of Finance. Whether this is granted depends on THAI's ability to pay off the debt, says a source. Of the requested amount, 32 billion baht is intended for working capital and the rest to improve cash flow.
The government's public debt management committee is therefore concerned about THAI's liquidity and foresees even more debt when the airline buys or leases 38 new aircraft for 156 billion baht. The Secretary of State has instructed the THAI board to review the plan for the purchase of new aircraft.
Source: Bangkok Post
Whether this is granted depends on THAI's ability to pay off the debt, says a source.
It seems unlikely that the Thai will ever be able to repay that loan, so the inability to repay that money will probably have to be the reason for granting that loan.
Dear readers,
Thai Airways International makes the same mistake as many airlines, in particular they fly everywhere instead of concentrating on one continent, be it Europe or North America or South America or Asia or Australia. As the son of the late former chairman of an airline company, this airline company made massive profits by focusing only on Europe. After the death of my father, this company was taken over by a group that also wanted to fly to North America and the Caribbean, two years later bankruptcy was filed and all employees were on the street. One wrong decision can lead to that.
Should Thai Airways International concentrate only on one continent, either North America or Europe, I am almost certain that they too would make profits and that would increase the service level to such an extent that Thai Airways International could once again compete with the others.
They should fly at airports where landing fees are minimal, so flying from Brussels is out of the question. Brussels is one of the most expensive airports in the world. In this world, every second counts, every minute that an airplane is on the ground, on the tarmac.
Would Thai Airways International only fly to, for example, Paris Beauvais, Dusseldorf, Rotterdam, Ostend-Bruges or, in other words, second-class airports in the various Western European countries with aircraft such as the Airbus 350-900 or the Boeing 787-800 (this is also possible with leased aircraft , they shouldn't buy those) and not with the mastadons like Boeing 747, 777, the world of Thai Airways International would look completely different, and I'm sure everyone would benefit, the pilots, the steward( essen), the passengers and so on and then again at competitive prices for business class and operating this class to very high standards, after all it is the business people where the profits are made. Economy class people is good to fill the plane, but these passengers don't give the company any profits, more like a break even (read in English) Don't get me wrong, I certainly don't want to throw a stone at the Economy class people. I sometimes fly economy sometimes business class, depending on my finances at the time.
I think the Thai drivers need to be shaken up and face the facts, after all it is the people who make an airline live, survive or push it to the abyss. If Thai Airways is losing more and more, it clearly means that the management is bad (It is difficult to look inwardly, accept his mistakes and give his place/job to someone who means it, who has new ideas). If they pump money into Thai Airways International today, the banks will be asked to do so again within the year. In my eyes that is a bottomless society with all the consequences that entails.
I'll give more of my unsalted comment later, everyone needs to know how the handle fits into the fork. I also make mistakes but try to learn as much as possible from them and not just open my umbrella.
Many greetings to all readers and Thailandblog contributors.
Keep on doing
Andreetje
Without the economy class passengers, those planes wouldn't be able to fly, because they can't fill a plane with only business class passengers.
Then they have to fly with smaller planes and make stopovers.
Apparently airlines can't make money on that, otherwise they would.
Dear Andreetje… could you provide a link and the name of the company your father was the former chairman of?
What have you done in your life? You have a business, I understand. What kind of company?
Why don't you work at Thai as a counselor? Then they would definitely survive, wouldn't they, because you seem to know exactly what's going on.
Yours sincerely.
Here's an interesting article about Thai Airways. About too many managers, too many free-traveling politicians (it seems to be NL), too many staff, corruption, etc.
htpp://www.http://bakertilly.co.th/insights/thai-airways-drastic-action-required/
In conclusion: will never become profitable with the Thai mentality of smearing and holding up hands