Thailand Deputy Transport Minister Thaworn Senneam paid a visit last week to ailing national carrier Thai Airways International to monitor the progress of the airline on its recovery plan and on obstacles faced by the carrier.
The Deputy Transport Minister wanted to follow up on progress made on the Ministry’s policy as well as operational problems and obstacles, in order for Thai Airways International to achieve better financial results and become one of the world’s leading airlines.
Thaworn Senneam monitored the right implementation of the Ministry’s policy, such as a financial turnaround and business plan, aircraft acquisition plans for 38 aircraft, company management and structure, U-Tapao aircraft maintenance centre, enhancing revenues and operating results.
Furthermore, additional policies were presented, such as human resource management, manage company property to the maximum benefit, manage and improve sales and marketing between Thai and its affiliate Thai Smile.
Mr Sumeth Damrongchaitham, Thai Airways International President, indicated to act upon the policies granted by the Transport Minister, which will be used in resolving accumulate financial losses and for longstanding profitability. Progress has been made on the following projects:
1. Reconsideration of TG Long Term Plan 2019-2026 that planned to acquire 38 aircraft. The airline’s Board of Directors approved of the plan to acquire aircraft to replace 17 aircraft that will be decommissioned if this proves to be suitable to the financial situation and current altered conditions. The Management is to study aircraft types and present results to the Board of Directors Meeting during this month. The Company will present information on the number of aircraft, acquisition methods, and investment sources for consideration to the Board of Directors Meeting in March 2020. This plan will assure Thai future growth and will be presented to the Ministry of Transport by 31 March 2020.
2. With regards to the Maintenance, Repair, and Overhaul Center (MRO), Thai has sent information to selected investors. The deadline for proposal submission is 6 March 2020. The process will include negotiation, display the choice results, and draft the Public-Private Partnership Agreement (PPPA) that would be submitted to the Office of the Attorney General and Eastern Economic Corridor (EEC) Policy Committee for consideration prior to the proposal to the Cabinet for agreement in August 2020. The Company expects to sign the PPPA with the awarded bidder by the end of August 2020 and it is expected that the new MRO centre at U-Tapao will be operational by April 2023.
3. Negotiations between the Company and Rolls Royce on damages are underway to seek compensation for damages from Rolls Royce for the period that Thai’s aircraft was not operational.
Furthermore, the airline looks at ways to increase its revenue according to the Middle Turnaround Plan (2020-2024) through innovation and digital technology to help sales to become more modern, faster and of higher quality. Technology will also be implemented for various projects such as TG Digital Technology, sales development plan, and boost ancillary revenue in order to improve online sales. THAI is in the process of implementing cost reduction and cost control as well as organizational restructuring.
The Deputy Transport Minister opened the floor to discussion about the open sky policy and emphasized the importance to increase revenue and reduce expenses on a continual basis, in order that THAI may turnaround its operations and be sustainable into the future.