FD/DD/TG*/PG/OX | Thailand-Based Carriers

[Go Ahead Eagles]

Increase in passenger numbers may reduce Thai Airways losses

Thai Airways has reported that it expects to narrow its losses for the year, as fuel prices remain lower and passenger numbers increase.

The Thai national carrier expects a significant loss for 2008, but is now saying that the loss for 2009 could be a small one, according to Raj Tanta-Nanta, the airline’s vice-president for investor relations.

Thai Airways has yet to report its 2008 earnings to the Stock Exchange of Thailand, but it has said that its loss in 2008 was due to high fuel prices and the closing of Bangkok’s two airports by anti-government protesters for a week late last year. More than 300,000 travellers were stranded during the country’s peak travel season when the airports were shut down.

The airline is reportedly filling 75 per cent of its seats at this time, as compared with 63 per cent in December, after Suvarnabhumi and Don Mueang airports reopened. A drop of 70 per cent in the price of jet fuel is also helping reduce operating costs.

More seats are being filled on routes to India, the Middle East and Europe, said the carrier’s vice-president, Pridi Boonsue said. At load factors of 71 per cent, the airline can break even, he added.

Never before in its 44-year history has Thai Airways lost money. Tisco Securities, however, is estimating that the airline lost 16.2 billion baht in 2008 due to foreign-exchange losses and a drop of around 21 per cent in its fourth-quarter passenger traffic.

[napoleon]

Thai airways earnings to drop by 18%

The Nation Published on February 12, 2009


Operating costs to be cut 5-10 per cent immediately

The business-improvement plan of Thai Airways International (THAI) foresees revenue falling 18.18 per cent this year, from Bt220 billion to Bt180 billion, due to the economic turmoil.


Board chairman Surachai Tansitpong said the airline planned to reduce annual operating costs 5-10 per cent. They can be cut 3 per cent immediately, saving about Bt6 billion alone.


The company waived annual commission payments and froze salary adjustments in last year's budget.


THAI will now also implement a hiring freeze until performance recovers.


"The company expects this year's financial results to return to positive territory," said Surachai.


THAI is expected to post a net loss of more than Bt10 billion for 2008, due to the global economic crisis in general and the shutdown of Bangkok's airports in particular.


The airport closure led to a sharp plunge in passenger numbers. In return for a


government guarantee of


a Bt12-billion loan, the airline is required to complete a


business-improvement


plan, which is being readied


by a working group chaired


by director Pichai Chunhava-jira.


The plan will cover the three calendar years from 2009-11. An urgent liquidity injection of Bt20 billion will be included, so that delivery of jumbo Airbus A380 aeroplanes planned for April will remain on schedule.


The board yesterday acknowledged the plan, which will be submitted to the State Enterprise Policy Office next Monday.


THAI plans a shareholders' meeting late next month or in early April, to inform shareholders of the business plan and financial results.


Speaking at a recent symposium in Bangkok, acting president Narongsak Sangapong said: "This year will be one of the most difficult for our industry. Our future success will depend on following the right strategies.


The situation may not be the same for every airline, as each must take into account its own situation and market, but a thorough understanding of the fundamental issues will be essential for success."


Meanwhile, Surachai said he would resign as board chairman soon. His decision is based on the recent change in government.


"It is a decisive move on my part to quit now that the government has changed," he said.


He said 10 board members would also resign along with him. The board has 14 internal and external members.


Surachai assumed the position last November, replacing Chaisawasd Kittipornpaiboon, who retired.

[Go Ahead Eagles]

Thai Airways keeps the Stockholm-Bangkok route


Yesterday SAS announced that the route between Bangkok and Stockholm is going to close down due to the airline’s financial problems.

But that’s does not mean that the direct flights between Sweden and one of the countries favourite travel destinations is history. Thanks to the international airline in Thailand, Thai Air, it is still possible for the Swedes to get to the Southeast Asian country in about ten hours.

According to the Swedish newspaper Aftenposten Thai air has officially confirmed that they plan to keep their route between the two capitals.


http://www.scandasia.com/viewNews.ph...e&news_id=5214

[napoleon]

THAI says traffic recovery rate faster than expected

Bangkokpost Published: 16/02/2009 at 12:00 AM


The recovery rate of passenger traffic on Thai Airways International flights in the aftermath of the Bangkok airport crisis has been faster than expected, thanks partly to some improvements in the country's international image.

The flag carrier was able to fill 75% of its seats in January after a slump in December when the seizure of Suvarnabhumi and Don Mueang airports by anti-government protesters paralysed much of the kingdom's air traffic.

"Our January load factor was much better than expected. We did not think earlier it would ever hit 70%," said THAI executive vice-president Pandit Chanapai.

The improved political landscape, heavy price promotions by THAI and a campaign by the Tourism Authority of Thailand have lessened the impact from the airport upheaval.

The load factor was improving in spite of the general decline in global travel demand, Mr Pandit added.

THAI was forced to cancel more than 1,000 flights from Nov 25 and Dec 4 when thousands of People's Alliance for Democracy (PAD) laid siege to the airports to demand the removal of the Somchai Wongsawat government.

The airport seizure cost the airline an estimated 20 billion baht in actual and potential revenue losses.

With the country's international image is gradually restored and various campaigns bearing fruit, Mr Pandit was cautiously optimistic about the continuation of relatively good load factors, saying the February figure should exceed 70%.

Airlines in general need a load factor of around 60-65% to break even.

He said that government leaders' efforts to build the country's image in international forums, including the forthcoming Asean Summit in Hua Hin, were far more effective for reviving travel than any other individual campaign.

THAI has also been restoring its capacity, which was severely cut back after the airport closures, to pre-shutdown levels. The airline does not plan to introduce any new destinations for the rest of this year but intends to increase frequencies on certain routes such as Bangkok-Milan, which will rise to five flights a week in July from four.

Mr Pandit confirmed that there was a good prospect for a pre-tax operating profit this year due to cost controls under a proposed rehabilitation and revenue-improvement plan.

The airline aims to reduce expenditures by 10% between 2009 and 2011. However, securities analysts expect the airline's net loss for 2008 to widen from an earlier forecast of around 10 billion baht to 16 billion because of the surge in oil prices, slowing travel demand and the airport closures.

[napoleon]

Fuel-hedging dooms THAI's performance Costs so far could approach B4-6bn

Bangkokpost Published: 20/02/2009 at 12:00 AM


Thai Airways International's bets against high fuel prices in the form of hedging have cost it up to 6 billion baht, compounding the financial woes the national carrier is facing. Senior THAI executives confirmed that the costs of hedging nearly a year ago could be anywhere between 4 billion and 6 billion baht.

The airline recently resumed making hedging contracts for April, after a brief suspension following a volley of criticism of alleged mismanagement of hedging arrangements.

The hedging missteps are expected to contribute to THAI's first loss in 45 years in 2008, estimated at 15 billion baht. It will report its results to the Stock Exchange of Thailand in the next few days.

Benchmark US crude dropped to a 2008 low of US$32.40 a barrel in December from an all-time high above $147 in mid-July. It was trading around $35 this week.

Volatile world oil prices seriously hurt most airlines last year. Those that hedged to protect themselves against rising costs ended up losing money when the price of crude oil slumped.

Chai Eamsiri, director of THAI's petroleum and fuel management department, yesterday conceded that, pending final accounting, the hedging would cost billions of baht but ''it is certainly less than 6 billion baht'' as reported by some media outlets.

He ruled out reports that he was told by the THAI management to stop hedging as jet fuel prices had become more stable, even declining, and to prevent the airline from being burdened with further costs if the hedged prices were lower than actual market levels.

He also denied that there was a change from the January 2003 directive given by the board to reduce hedging volume from the set ceiling _ no more than 50% of its annual fuel requirement with contract terms not exceeding one year.

Mr Chai said the most recent fuel-hedging contracts from April were lower than the level for March contracts which represent 17% of fuel requirements.

The April contracts were hedged at below the current Singapore spot prices, he added. The price stood at US$54.86 a barrel on Wednesday.

In 2008, THAI had 14 hedging arrangements with volumes in the second half representing 41% of its monthly consumption with a price range of $86 to $125 a barrel.

The airline sourced the remaining 59% of its jet fuel requirements from spot markets. THAI's jet fuel consumption last year was 22 million barrels.

''We will definitely continue to use the hedging as a tool to minimise and diversify risks, not to make money or gamble,'' Mr Chai said.

The volume of hedging will largely depend on the market environment and the level of risk we want to take manage in a specific time.''

Jet fuel prices are expected to remain at around $60-70 a barrel in the second half of this year.

THAI shares closed yesterday on the Stock Exchange of Thailand at 7.55 baht, unchanged, in trade worth 3.02 million baht.

[napoleon]

Thai Airways yet to submit its business-improvement plan

By The Nation Published on February 25, 2009


Thai Airways International (THAI) has not yet submitted its business-improvement plan to the State Enterprise Policy Office, the office's chief Areepong Phoocha-um said yesterday.

He said this could indicate the airline's ability to sustain its own financial position without the Finance Ministry's help.


"Initial reports show an improvement in the company's revenue in January, and the February revenue should be at the same level. Plus, the Asean Summit should also lift its operations. As the Finance Ministry has not received the plan, I believe it could manage liquidity on its own," he said.


Meanwhile, THAI saved Bt955 million last year as a result of fuel management measures, which reduced consumption by 35,497 tonnes. Flying Officer Norahuch Ployyai, THAI's executive vice president, Operations Department, said fuel costs had been reduced by more than initially targeted.


"Fuel costs are amongst the company's greatest operational expenses. Through fuel management, flights are conducted in ways that reduce fuel costs in accordance to the company's flight operations manual or by decreasing cargo weight to cut down on fuel consumption, while complying with commercial aviation regulations," he said in a statement.


The measures were implemented at the beginning of last year when the company experienced a sharp increase in jet fuel prices. The world economic crisis and political situation in Thailand then led to lower demand for passenger travel.


As a result, the firm implemented cost control and reduction by putting fuel management into effect and increased its marketing efforts in order to up profitability.


In the second half, THAI reduced its route expenditure by Bt605.1 million.


Cost control and reduction included a lowering of flight frequencies and the number of flight and cabin crew, as well as the number of layover days.


THAI was earlier criticised for hedging fuel prices at high levels, but it rebutted that the hedging loss was tiny compared with that from the disappearance of passengers following the global economic crisis and the Bangkok airport closures.


Suffering from a severe liquidity shortage, the national carrier is in the process of securing the Finance Ministry's guarantee for a Bt12-billion loan. Cost-cutting is a major part of the company's business-improvement plan.


The airline is also planning to be more active in the cargo business. It recently took part in the World Air Cargo Event 2009.


THAI's managing director of the Cargo and Mail Commercial Department, Pruet Boobphakam, said cargo operations were in support of the plan to recover from the world economic downturn. Review and improvement on use of cargo space, equipment and workforce had been made to meet future challenges, he said.

[napoleon]

THAI’s Catering Department Wins ITCA Mercury Award

26/02/2009


Thai Airways International Public Company Limited’s Catering Department won the Mercury Award, under the category Skill Development for Good Agricultural Practice (GAP), recognizing THAI’s implementation of good agricultural practice in educational and training processes, systems, and products, which successfully enhances customer services.

Mr. Smith Pirunsarn, Managing Director, THAI’s Catering Department, revealed that THAI was proud and honored to have received the Mercury Award. The company’s catering staffs have worked hard to maintain high hygiene standards. THAI’s Catering Department focused on product quality and hygiene. The Good Agricultural Practice (GAP) program was developed in 2003 as a cooperative effort by THAI’s Catering Department and Kasetsart University for contract farming, which educates farmers in order to develop and produce good and safe raw materials for THAI’s Catering Department. Attaining the Mercury Award signified that THAI’s Catering Department can ensure customers that all meals served on board THAI flights are hygienically prepared .

The award presentationto the judges took place in London during the month of in January, which was attended by THAI’s and Thai’s team: consisted of Mr. Sompote Sukarochanee, Director, On Ground Production and Services, Mr. Odd Engebretsen, Catering Services Specialist, and Mr. Piroon Songjakkaew, Division Manager, Production Planning.
Mercury Award, organized by the International Travel Catering Association (ITCA), is the most prestigious award for travel catering worldwide. Mercury Award features 6 categories including On Board Service, Food or Beverage, Equipment, Skills development, Systems and Process Development and Inspiration. ITCA is an association governed by 15 board members, with award selection conducted amongst 700 ITCA members worldwide. Mercury Award results were officially announced on 12 February 2009, during a special awards dinner held in Barcelona, Spain.

Seen in Photo:
1. Mr. Smith Pirunsarn (2nd from right), Managing Director, THAI’s Catering Department
2. Mr. Sompote Sukarochanee (2nd from left), Director, On-Ground and Services Department, THAI’s Catering Department
3. Mr. Mike Pooley (far left), President of Gate Gourmet Asia Pacific
Mr. Lionel Wilton (far right), C.E.O. of Alpha-group

[napoleon]

THAI posts Bt21-bn loss for 2008

The NationPublished on February 28, 2009


Thai Airways International has announced an annualised net loss of Bt21.31 billion for last year.


Of that, Bt14.7 billion was from the fourth quarter alone, due to the closure of Suvarnabhumi Airport and the global economic downturn's effect on travel demand.


In 2007, the company enjoyed a net profit of Bt4.3 billion.


Last year's net loss was worse than analysts' estimates of about Bt13 billion.


Still, Transport Ministry permanent secretary Surachai Tansitpong, who is also chairman of THAI's board, believes the airline will return to the black this year on revenue of Bt4 billion, thanks to cost-cutting and weaker oil prices.


He said the situation had already improved in the first two months of the year, which would reduce THAI's demand for liquidity from Bt34 billion to Bt20 billion. The airline raised Bt22 billion in loans last month to help overcome a liquidity shortage.


Surachai said the board yesterday approved a business-improvement plan featuring short-, medium- and long-term measures.


Pichai Chunhavajira, a director who chairs the committee in charge of the plan, said it would be finalised within a month and then submitted to the Transport Ministry for approval before being implemented in April. Surachai said THAI would focus on increasing its cash flow, improving asset management and improving its debt and fund structures, to shore up liquidity.


The airline will also concentrate on increasing revenue, improving operational efficiency, enhancing product and service quality and improving cost management.


"The whole strategic plan is aimed at increasing yield and reducing operating costs," he said.


As per its cost-reduction plan, the airline expects to reduce costs 5 per cent in the first year, rising to 20 per cent per year in 2012.


THAI booked a foreign-exchange loss of Bt4.47 billion last year. It also reported Bt4.43 billion in provisions against the declining value of aircraft it intends to sell.


Its passenger traffic plunged 35 per cent in last year's fourth quarter after protesters shut Suvarnabhumi Airport during the nation's peak tourism season, stranding some 400,000 travellers.

[napoleon]

THAI EXPECTS BT4-BN boost from cargo

By The Nation Published on March 4, 2009


Carrier to discuss options with Boeing for dedicated planes Thai Airways International hopes that the cargo airline business it plans to operate next year will help boost the company's cargo revenue to Bt24 billion per annum from the current Bt20 billion.


Pruet Boobphakham, managing director of the carrier's Cargo and Mail Commercial Department, said the company would this week discuss with Boeing possible solutions about how to manage the air cargo.


The company has four options for dedicated cargo aircraft.


lModify an existing Boeing 747-400 into a cargo flight, which would require a budget of US$20 million (Bt722 million).


lLease old-model aircraft from manufacturers.


lPurchase 777-200 aircraft from Boeing, for which Thai Airways would have to pay $150 million per aircraft.


lLease new aircraft from other airlines.


He said Thai Airways needed to have a full cargo operation to strengthen competitiveness in the long term and also cut into the market share of rivals.


The [four] solutions could be finalised in the next two months before being submitted to the company's board for approval, he added.


"The cargo business in the country has a size of 1 million tonnes, but Thai Airways has a market share of only 100,000 tonnes because we have to load the goods in our passenger aircraft, instead of using cargo carriers. Moreover, we see potential in the cargo business. If we have own cargo airline, it will drive revenues up to Bt24 billion from the current Bt20 billion," said Pruet.


Thai Airways reported that its cabin factor last month was 77.4 per cent, above the company expectation of 73 per cent, which is a result of the increase in passenger numbers on routes to Europe. The company expects that its cabin factor in the first quarter will reach 75 per cent.


Meanwhile, Krung Thai Bank senior executive vice president Preecha Phukham yesterday said the bank was ready to provide a loan of Bt15 billion to Thai Airways to improve its liquidity.


Thai Airways needs up to Bt20 billion in financial support to offset losses incurred from the fuel-price volatility and the impact from the closure of Suvarnabhumi and Don Mueang airports by anti-government demonstrators late last year.

[napoleon]

THAI to leave Don Mueang airport

By: BangkokPost.com Published: 6/03/2009 at 11:31 AM


Thai Airways International (THAI) will move all of its flights from Don Mueang airport to Suvarnabhumi airport, starting on March 29, the airline's acting president, Baribgsaj Sangapong, said on Friday.

He admitted the change could be confusing for foreign travellers who have booked the tickets in advance.

Things would be made clearer at a press conference to be held later today, he said.

During the Songkran festival in April, three aircraft would be at the Don Mueang airport to serve travellers who may be confused about the change of airport.

But afterward, all THAI operations would be shifted to Suvarnabhumi airport, he said.

[napoleon]

National flag carrier THAI reaffirms March 29 Suvarnabhumi move


BANGKOK, March 14 (TNA) -- A committee responsible for restructuring the operations of cash-strapped national flag carrier Thai Airways International (THAI) has agreed to transfer all the airline’s domestic flights to Suvarnabhumi international airport effective March 29 in a bid to improve its network of operations and handling efficiency and reduce overall operating costs.

The decision by the committee was reached Thursday when it considered the advantages which passengers would receive from integrating domestic flights and services from Bangkok’s Don Mueang Airport with its international operations at Suvarnabhumi airport.

THAI has said that moving all 23 domestic flights to Suvarnabhumi will enable it to better manage its flights and facilitate passengers wishing to travel throughout Thailand as well as making connections to international flights. The move will also help support the government’s policy on promoting national tourism and economic growth.

In an attempt to provide better services to passengers at Suvarnabhumi, the airline will triple the number of check-in counters there from 12 at present to 36.

Besides that, THAI will also add e-check-in points, and expand its VIP lounge by nearly half again, from 650 square metres to 934 sqm, and also increase the number of ground staff.

The committee’s meeting came one day after Prime Minister Abhisit Vejjajiva ordered the Ministry of Transport and THAI management to submit details of how THAI would gain from moving its domestic flights to Suvarnabhumi.

Transport Minister Sopon Zarum has stood firm that THAI must move its fleet and services to Suvarnabhumi by March 29.

Mr. Sopon said his ministry will report on the benefit derived from a one airport policy within two weeks but promised that the move will take place within the deadline. (TNA)

[Rohne]

http://www.airliners.de/news/artikel...rticleid=17608 (German article)

Thai announced at the ITB in Berlin, they will start service with the A380 in october 2010 (winter schedule). First route will be Bangkok - Frankfurt (not really surprising).

[goschio]

Why not really surprising? Are Germans the main tourist group in Thailand?

[Rohne]

Originally Posted by goschio

Why not really surprising?

Thai announced three A380 destinations up to today (FRA, LHR, CDG). Thai is member of Star Alliance (FRA is Star Alliance hub) and has two daily flights to FRA with B744 (LHR also two flights, but one is only served by A346; CDG even only one flight)...

[napoleon]

THAI cargo services moved to Suvarnabhumi on March 29

By The Nation 20/03/2009


Thai Airways International confirmed on Friday that all domestic operations will be moved from Don Mueang airport to Suvarnbhumi airport from March 29 onwards.

Pruet Boobphakam, THAI's Managing Director Cargo & Mail Commercial Department, said that all cargo services at Don Mueang warehouse will operate until March 28 and later they will be moved to Suvarnabhumi as well.


THAI's cargo-handling services will start its 24 hours daily operation at Suvarnabhumi Airport from March 29 onwards.


Outbound cargo services of all flights from Don Mueang Airport on March 28 will be provided until 6pm, except TG1124 routed Bangkok-Chiang Mai, which will be serviced until 8pm. All unclaimed inbound cargo shipped to Don Mueang Airport prior to March 29 will be kept at Don Mueang warehouse until April 20.

[napoleon]

THAI starts non-stop flights to Kuwait

Bangkokpost Published: 20/03/2009 at 12:00 AM


Thai Airways International is spreading its wings to the Middle East with a non-stop flight to Kuwait and plans to add Abu Dhabi and Riyadh to its Gulf network. The flag carrier's expansion to the Middle East is targeted at cashing in on the traffic demand in the region, which has been less affected by the global downturn than other territories it operates to.

THAI's first non-stop Bangkok-Kuwait City service will start on March 29. The route will have five flights a week with Airbus 340-600 jetliners, each able to carry 267 passengers in three classes.

The carrier will also make a final decision within two weeks on whether to launch Bangkok-Abu Dhabi and Bangkok-Riyadh services, said Vira Bunnag, THAI's director for South Asia and the Middle East region.

Subject to aircraft availability and the outcome of an economic viability study, the airline will offer three or four flights a week on both the Bangkok-Abu Dhabi and Bangkok-Riyadh routes as soon as the end of this month with Airbus A330-300s, each with 305 seats.

If the plan is approved, it would represent a major stride into the Middle East at a time when airlines around the world are retreating, cutting back capacity and shrinking network to match lower traffic demand.

The move would also build on THAI's network in the Middle East, where the airline already covers three cities _ Muscat, Dubai and Kuwait City.

The launch of non-stop Bangkok-Kuwait City flights will end the current service to Kuwait City via Dubai, which has run for about six years and currently has three flights a week.

The new flight would also remove a bottleneck in Dubai for THAI, enabling it to capitalise on traffic demand between Kuwait and Bangkok, said Mr Vira.

Demand on the Bangkok-Kuwait City and Bangkok-Abu Dhabi routes consists of leisure, labour and business travel, while demand on the Bangkok-Riyadh sector is largely for pilgrimage.

THAI already has traffic rights to operate non-stop flights on these routes.

The airline targets a load factor of 80% on the non-stop Bangkok-Kuwait City route, up from about 70% last year for the current service via Dubai.

THAI will also ramp up its service to Dubai to twice daily on March 29.

It also operates three flights a week to Muscat via Karachi.

[napoleon]

All set for THAI's move from Don Mueang

THE NATION Published on March 28, 2009


Starting tomorrow, Thai Airways International will shift its 46 domestic flight operations at Don Mueang to Suvarnabhumi Airport. Top officials of THAI, Airports of Thailand and Aeronautical Radio of Thailand said all is set for the move, which will end the national flag carrier's operations at Don Mueang.

ACM Narongsak Sangapong, the airline's acting president, said the last flight (to Chiang Mai) would depart from Don Mueang at 10.15pm today.

Serirat Prasutanon, general manager of Suvarnabhumi Airport, said the number of domestic flights at Suvarnabhumi will rise to a total of 206 with over 31,000 passengers per day.

Besides THAI, Bangkok Airways and Thai Air Asia also operate domestic flights at Suvarnabhumi.

Somchai Thean-anant, president of Aeronautical Radio of Thailand, said traffic controllers are now ready to cope with an increase of flights from the current 700 to around 750 resulting from THAI's decision to end its services at Don Mueang.

Currently, THAI operates domestic flights from Bangkok to Chiang Mai, Chiang Rai and Phitsanulok in the north; Khon Kaen, Udon Thani and Ubon Ratchathani in the Northeast; and Phuket, Krabi, Surat Thani, Hat Yai and Samui in the south.

Narongsak said: "The move under one roof concept is a major strategy of Star Alliance, of which THAI is a founding member. It is ideal for Suvarnabhumi Airport because it is a single terminal."

"It means we can further consolidate our passenger services, increase traffic flow and efficiency and improve transit times."

Meanwhile, the airline's labour union yesterday submitted a letter to transport minister Sophon Saram, urging the government to review THAI's plan to end its domestic flights at Don Mueang.

"The cost and benefit of moving all flights back to Suvarnabhumi remain unclear, especially in terms of a saving of Bt648 million in operating cost per year. As for passengers, Suvarnabhumi airport's capacity has not yet been increased to serve as the country's single gateway," Chamsri Sukchokerat, the union's president, said.

However, Chaisak Angsuwan, deputy transport permanent secretary, said the plan would go ahead as scheduled.

[napoleon]

No THAI credit without plan

THE NATION Published on March 31, 2009


Thai Airways International has to get a government guarantee for its rehabilitation plan before asking banks for more credit.


A working committee headed by Pichai Chunhavajira will complete drafting the plan late this month and then submit it to the Finance Ministry, which is the airline's major shareholder.

The panel would present the plan to more than 10 financial institutions and seek their cooperation to replenish liquidity, pay for new aircraft and service existing loans.

THAI will likely postpone the presentation, pending next month's election of a new board of directors. The flag carrier, which reported more than Bt20 billion in losses for 2008, is facing a serious liquidity crunch.

Piti Tantakasem, chief wholesale banking officer at TMB Bank, said that THAI, which is also looking for a new CEO, had not approached the bank for fresh funds.

"We've not seen the rehab plan. We also need to know the degree of government support for THAI as far as its financial condition is concerned," he said.

TMB Bank maintains a Bt1-billion, one-year working-capital facility for THAI.


Surasak Dudsdeemaytha, first senior vice president at Kasikornbank, said the bank, which has a short- term loan out to THAI, has no plan to give more funds.

"We're not sure if the Finance Ministry will continue to guarantee the airline's debt. If not, how will the debt be restructured or how will its aircraft acquisition plan be postponed to ease the financial burden?" he asked

Chansak Fuangfu, a senior executive vice president at Bangkok Bank, said THAI will likely name its new CEO before discussing its rehab plan with financial institutions.

Pichai earlier said banks' confidence in the airline's future is key to the success of the plan. Creditors are concerned about whether the airline could turn around its finances.

Areepong Bhoocha-oom, head of the airline's committee for cost reduction, is considering a plan to reduce the airline's expenses by 15 per cent or about Bt10 billion.

One of the key areas for scrutiny is new aircraft procurement, as some plane types do not mesh with the airline's flight operation policy, especially on long-haul routes.

According to the current fleet expansion plan, six of the eight Airbus A330-300s ordered by THAI are due for delivery later this year.

The airline is considering putting off delivery of two of these aircraft by another year to ease its financial burden.

Other longer-term orders, including the six Airbus A380s, will be revised with the option of changing the models or cancelling the orders.

The rehab committee also agreed that a salary cut would be a last resort, but noted that THAI will have to beef up its top management, improve its operations and quality of services to be more profitable and flexible.

The panel last week started presenting the plan to the airline's executives and then the employees of all departments to foster understanding on what direction the airline should move in and what strategies will benefit the company in the future.

[napoleon]

THAI expects more passengers after move

The Nation Published on March 31, 2009


Thai Airways International hopes to gain 3,500-4,500 extra passengers per day after moving domestic operations back to Suvarnabhumi Airport while major carriers see positive prospects for Thailand to become a regional aviation hub.


According to the national carrier, 6.9 million domestic passengers were carried by all airlines at Suvarna-bhumi last year. THAI operated 45 flights per day with 2.9 million passengers or 42.6 per cent of the total.


The airline expects passengers switching from Don Mueang Airport to Suvarnabhumi would reach 105,000-135,000 per month or 3,500-4,500 per day.


THAI's 81.5-per-cent load factor was higher than the break-even point projected at 78.9 per cent.


However, THAI reportedly flew fewer domestic passengers at Suvarnabhumi than Thai AsiaAsia, which has snatched the biggest share.


At Suvarnabhumi alone, THAI earned Bt248 million on Bt8.6 billion in revenue last year.


The firm operated 45 flights a day at Don Mueang and carried 2.7 million or 54.5 per cent of the total of 5 million domestic passengers.


Since its 79.2-per-cent load factor at Don Mueang missed the break-even point of 79.6 per cent, it lost Bt29.6 million.


To encourage domestic passengers to patronise Suvarnabhumi, THAI will deploy kiosks and launch a new online service.


Home-printed boarding passes were introduced in February, and THAI plans to make them available for international flights in May.


A dozen stations have already been added to THAI's domestic check-in counter at Suvarnabhumi.


Chan Seck Fun, area managing director of Qatar Airways, said the airline wants to see a single airport policy in Thailand because it would help the country become a regional aviation hub.


However, the government must construct more facilities at Suvarnabhumi, such as a third runway and bullet-train system.


"If Thailand had an airport with good infrastructure, the country can be a regional aviation hub," he said.


If the government insists on keeping Don Mueang open, a very good mass-transit system between the two airports is needed for transit passengers, he said.


Yongyut Lujintanon, Cathay Pacific's sales and marketing manager for Thailand and Burma, also agreed with a one-airport policy for Bangkok.


If the government wants Bangkok to be a centre of aviation, it should consider interline connectivity, which is a key factor for international airlines in deciding whether to expand or revise their network or strategic plans, he said.


The Board of Airline Represent-atives has been urging the government to stick with a single airport, he said. The group said a single airport would persuade more airlines to put more frequencies into Thailand.


Tasapon Bijleveld, CEO of the country's largest budget airline, Thai AirAsia, said overseas travellers preferred to use one airport as it was easier to catch a connecting flight to destinations within Thailand and abroad.

[napoleon]

National carrier's recovery plan handover due in two weeks

The Nation Published on March 31, 2009


Thai Airways International's Thai Airways International's recovery plan is expected to be handed over to Finance Minister Korn Chatikavanij in the next couple of weeks, with no plea for financial assistance.

Areepong Phoocha-oom, director-general of the State Enterprise Policy Office, said THAI will not ask for financial assistance or any guarantee from the ministry. The national carrier, however, is negotiating with banks to roll over its debt obligations, he said.


The company is expected to gain more passengers after it started operating solely out of Suvarnabhumi Airport, due to more convenience to travellers, he said. A partial recovery of the tourist industry had also benefited the carrier, he said.


The national carrier is currently scheduled to hold a roadshow for its creditors in order to get more finance and improve its liquidity.


THAI, this year, has also signed up to participate in State Enterprise Performance Appraisal (Sepa) initiated in 2007.


Areepong said Sepa will help state enterprises increase their productivity and provide better services to customers. It will ensure the continuity of best practices through change of CEO or board of directors.


Sepa has a reference to Malcolm National Quality Award in the United States, which has been adopted by 70 countries, he said.


Areepong said that several local state enterprises are not clear about their goals and direction.


The Sepa would guide them in having a clear mission, strategy and customer orientation, he said.


Singapore government's agencies have been praised for succeeding in adopting the performance appraisal system, resulting in excellent services to its citizens, said Areepong.


He said all 58 state enterprises will participate in the scheme by 2013.


State enterprises have combined assets worth Bt6.86 trillion and account for annual transfers of Bt100 billion to government coffers.


George Madhavan, director of Singapore's National Water Agency, said that learning and innovation are among key factors for successful running of state enterprises.