Embattled Bangkok-based carrier Thai Airways is to lay off 395 pilots as part of its restructuring and rehabilitation plan. It follows Thai Airways Acting President Chansin Treenuchagron last month saying the airline’s reorganization was on track and progressing well. This round of retrenchment means Thai Airways will now employ less than 1,000 pilots.
One more blow for Thai Airways
It’s another hiccup in a litany of problems facing Thai Airways as it struggles to avoid disappearing off the aviation map. The airline first sought bankruptcy protection in May 2020. The travel downturn pushed Thai over the fiscal cliff, but the airline had bled red ink for years. Depending on who you asked or how you measured it, Thai Airways had debts above US$7.75 billion. The airline also lost over US$900 million in the first half of 2020.
Thai Airways was majority-owned by the Thai Government. That was much of the problem. The airline was a hotbed of cronyism, mismanagement, and waste. There are some tall stories out there about what went on at Thai Airways. For example, a former Chairman of the airline got jailed last year after failing to pay for 300kg of excess baggage. That kind of behavior is the tip of the iceberg. Multiple jurisdictions have run investigations into fraud and mismanagement among upper management ranks at the airline.
Thai Airways makes some inroads in sorting its problems
The Thai Government had to sell down its majority stake to qualify for bankruptcy protection under Thai law. The government’s stake is now 47.86%, having sold 69.2 million shares to a mutual fund run by Krung Thai Bank in May. But the Thai government selling down its stake could be the best thing that ever happened to Thai Airways.
Since entering into bankruptcy protection, the airline has made some inroads into sorting its problems out. That includes re-negotiating deals with lessors and creditors. In addition, there have been some changes to Thai Airways’ unwieldy fleet. According to aircraft database planespotters.net, Thai has 61 aircraft in its fleet (all but nine are parked). Those 61 planes comprise five types, including Airbus A380s, Airbus A330s, Airbus A350XWBs, Boeing 787s, and Boeing 777. In conjunction with the announcement of further lay-off, Thai Airways also said they would “ground” their Airbus A330 and A380 aircraft. Simple Flying has reached out to Thai Airways to ascertain exactly what that means.
Chansin Treenuchagron positive about Thai Airways’ future
Shortly after entering into bankruptcy protection, Thai Airways began defaulting on debt. In July, Simple Flying reported on the airline saying it couldn’t pay US$2.7 billion then owing. That default affected banks and official government stakeholders.
Since entering into bankruptcy protection, there has been one problem after the other at Thai Airways. Some are significant, such as the debt default. Some are more minor, such as the airline banning food and drink on domestic flights. But it adds up to a continuing run of poor publicity for Thai Airways.
Despite this, acting president Chansin Treenuchagron says things are on track at Thai Airways. The local bankruptcy court has granted an extension to the airline, giving it until March 2 to submit its rehabilitation plan. Reportedly, the delay is due to the airline’s complex financial deals and debts. But Thai Airways says it is confident the plan will be ready by the new due date. Unfortunately, none of this makes much difference to the 395 pilots out of work.