According to the President of Star Alliance member airline Thai Airways, the Bangkok-based carrier is on the verge of shutting down if they don’t succeed quickly in a turnaround. The government has given the airline one month to come up with a new cost-cutting plan.
Thai Airways International (THAI) president Sumeth Damrongchaitham said on Tuesday that staff must cooperate with the airline’s rehabilitation efforts because it is in a crisis and faces possible closure.
…”Today I want staff to be united to overcome the obstacles. Otherwise, the national airline must close down. There is still time for a solution, but there is not much time,” Mr Sumeth said.
The carrier lost $211 million in the first half of 2019, bringing total losses to $9.2 billion. The country’s national airline has traditional been run as a cronyist enterprise, benefiting its stakeholders, but its business has been eroded by low cost competition.
Over the summer the airline’s President introduced a six point plan to crowd source cost cutting ideas; reduce food waste; make a ton of money flying to Sendai, Japan; collaborate with a local gas station cafe chain; and platitudes but it was (shockingly) insufficient.
Thai’s new plan is to “reduc[e] the salaries of managerial staff ” and follow “a zero inventory policy at its catering department” according to the carrier’s President. What’s more, “[t]here will be no other rewards for the staff, because the top prize is the survival of the company.”
I had such high hopes for the airline’s earlier plan to profit by selling frozen foods.